Yandell expects to produce 1,950 units in January and 2,120 units in February. T

Question

Yandell expects to produce 1,950 units in January and 2,120 units in February. The company budgets 5 pounds per unit of direct materials at a cost of $35 per pound. Indirect materials are insignificant and not considered for budgeting purposes. The balance in the Raw Materials Inventory account all direct materials on January 1 is 5,000 pounds. Yandell desires the ending balance in Raw Materials Inventory to be 20% of the next month's direct materials needed for production. Desired ending balance for February is 4,600 pounds. Prepare Yandell's direct materials budget for January and February. Begin by preparing the direct materials budget for January and February through total direct materials needed line and then complete the budget by calculating the budgeted cost of direct materials purchases. Yandell Company Direct Materials Budget Two Months Ended January 31 and February 28 January February Direct materials (pounds) per unit Direct materials needed for production Plus: Total direct materials needed

Explanation / Answer

Please find below answer of your question. If this helped, please hit LIKE button. If need any explanation, put it in comment.

January February Total A Budgeted units to be produced 1950 2120 4070 B Direct Materials (pounds) per unit 5 5 5 A*B=C Direct Materials needed for production 9750 10600 20350 D add: Ending Inventory (20% of 10600) 2120 4600 4600 C+D=E Total Direct material needed 11870 15200 24950 F less: Beginning inventory 5000 2120 5000 E-F=G Budgeted Purchase of Direct Material 6870 13080 19950 H Cost per Unit 35 35 35 G*H=I Budgeted cost of Direct Material 240450 457800 698250

Related Questions

Navigate

• Browse (All)
• Browse Y
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.