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ssignment/takeAssignmentMain.do?invoker-assignments&takeAssignmentSessionLocator-assignment-take;&inprogress-false; eBook Show Me How Calculator Direct Materials Purchases Budget Daybook Inc. budgeted production of 403,500 personal journals in for each journal. The estimated January 1, 20Y6, is 40,4 yards. 20Y6. Paper is required to produce a journal. Assume six square yards of paper are required per inventory is 40,400 square yards. The desired December 31, 20Y6, paper inventory is 38,900 square paper costs $0.40 per square yard, determine the direct materials purchases budget for 20Y6

Explanation / Answer

Direct material purchase (quantity) = Production unit+desired ending inventory-beginning inventory

= (403500*6)+38900-40400

Direct material purchase (quantity) = 2419500 square yard

Direct material purchase (cost) = 2419500*.40 = $967800

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