Purple Co.\'s production budget for Product X for the year ended December 31 is
ID: 2546106 • Letter: P
Question
Purple Co.'s production budget for Product X for the year ended December 31 is as follows: Sales (in units) Plus desired ending inventory Total Less estimated beginning inventory, Jan. 190,000 Total production Product x 640,000 85,000 725,000 635,000 In Purple's production operations, Materials A B and C are required to make Product × The quantities of direct materials expected to be used for each unit of product are as folio s: Product )x Material A 0.50 pound per unit Material B 1.00 pound per unit Material C 1.20 pound per unit The prices of direct materials are as follows: Material A $0.60 per pound Material B $1.70 per pound Material C $1.00 per pound Prepare a direct materials purchases budget for Product X assuming that there are no beginning or ending inventories for direct materials all units purchased are used in producti Direct Materials Total required for production of Product xos. os. os. Unit price Total direct materials purchases $ PreviousExplanation / Answer
Purple Co
Direct materials purchases budget for Product X:
Direct materials purchases budget for Product X
A
B
C
Total
units required for production of Product X
0.50 pounds
1.00 pound
1.20 pounds
unit price
$0.60/pound
$1.70 per pound
$1.00 per pound
Total direct material purchases in pounds
317,500
635,000
$762,000
Cost of direct material purchases
$190,500
$1,079,500
$762,000
$2,032,000
Note:
Total production of product X is 635,000 units.
Requirement of Material A 635,000 x 0.5 pounds = 317,500
Requirement of Material B – 635,000 x 1.00 pound = 635,000
Requirement of material C – 635,000 x 1.20 pounds = 762,000
Direct materials purchases budget for Product X
A
B
C
Total
units required for production of Product X
0.50 pounds
1.00 pound
1.20 pounds
unit price
$0.60/pound
$1.70 per pound
$1.00 per pound
Total direct material purchases in pounds
317,500
635,000
$762,000
Cost of direct material purchases
$190,500
$1,079,500
$762,000
$2,032,000
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