PRINTER VERSION NEXT Exercise 175 Tall Oak, Inc. produces rulers from plastic re

Question

PRINTER VERSION NEXT Exercise 175 Tall Oak, Inc. produces rulers from plastic resin. Tall Oak has estimated production and sales o, rulers in unes for the?xt 2 months May June 48,000 50,000 36,000 Estimated production 42,000 Estimated sales Each ruler requires 25 pounds of resi The cost of esin is $4.50 per pound. Tall akwants to have 20% of the net en materais ea rement, on hand at th, end of each month. Prepare a direct materials purchases budget for the month of May. (Enter negative amounts using either a negative sign preceding the number ag. 43 r parentheses e.g (45). Round pounds needed per unit to 1 decimal palce and cost per pound to two decimal palces.) TALL OAK, INC Direct Materials Purchases Budget Month of May Cost per pound Beginning inventory Ending inventory desired Total cost of purchases of materials Total pounds needed for production Estimated production in units for May Pounds needed for production in May Pounds needed per unit Question Attempts: O of 1 used SAE OR LATES SUBMET ANSWER

Explanation / Answer

Direct material purchase budget :

May Production units in may 42000 Raw material per unit 0.25 Raw material for production 10500 Add Desired ending inventory (48000*0.25*20%) 2400 Total needs 12900 Less: Beginning inventory (42000*0.25*20%) (2100) Raw material purchase 10800 Cost per pound 4.50 Raw material purchase cost 48600

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