ework Help Save & Eoit Check my work The following informetion applies to the qu

Question

ework Help Save & Eoit Check my work The following informetion applies to the questions displayed below Morganton Company makes one product and it provided the follawing information to help prepare the master budget a The budgeted selling price per unit is $70 Budgeted unit sales for June, July, August and September are 8,400 10,000, 12.000, and 13,000 units, respectively. All sales are on credit b Forty percent of credit sales are collected in the month of the sale and 60% in the following month. The ending finished goods inventory equels 20% of the following month's "it sales. d T1e ending raw materials riventory equals 10% of the following month raw matenais production needs Each unit of Snished goods requires 5 pounds of rew materials. The raw materials cost $2.00 per pound e. Thirty percent of rew meteras purchases are paid for n the month of purchase and 70%,n me noong mom t The direct labor wage rate is $15 per hour. Each unit of finished goods requires two direct labor-hours vo o0ng and edministretive expenseper nt solda 80The fised seling and adminsreivepense per month is $60,000 9 What is the estimeted raw materials inventory balence at the end of July Prev 4 5 6 0

Explanation / Answer

Calculate estimated raw material inventory balance at the end of july :

August production = 12000+(13000*20%)-2400 = 12200 units

Production needs = 12200*5 = 61000

Raw material inventory balance of july = 61000*10% = 6100 pounds

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