The following information is from the manufacturing budget and the budgeted fina

Question

The following information is from the manufacturing budget and the budgeted financial statements of Fabor Fabrication.

  

a. Compute the budgeted amount for purchases of direct materials during the year.

b. Compute the budgeted amount for cash payments during the year to suppliers of materials.

Direct materials inventory, January 1 $ 80,000 Direct materials inventory, December 31 92,000 Direct materials budgeted for use during the year 300,000 Accounts payable to suppliers of materials, January 1 50,000 Accounts payable to suppliers of materials, December 31 90,000

Explanation / Answer

a

b

Direct materials budgeted for use during the year 300000 Direct materials inventory, December 31 92000 Less Direct materials inventory, January 1 80000 budgeted amount for purchases of direct materials 312000

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