Ask Question
27 November, 15:55

Alliance Company budgets production of 23,000 units in January and 27,000 units in the February. Each finished unit requires 4 pounds of raw material K that costs $2.00 per pound. Each month's ending raw materials inventory should equal 30% of the following month's budgeted materials. The January 1 inventory for this material is 27,600 pounds. What is the budgeted materials needed in pounds for January?

+4
Answers (1)
  1. 27 November, 15:58
    0
    Total = 96,800 pounds

    Explanation:

    To calculate the direct material requirement, we need to use the following formula:

    Budgeted material = required for production + desired ending inventory - beginning inventory

    Budgeted material:

    Production for January = (23,000*4) = 92,000

    Desired ending inventory = (27,000*4) * 0.3 = 32,400

    Beginning inventory = (27,600)

    Total = 96,800 pounds
Know the Answer?
Not Sure About the Answer?
Find an answer to your question 👍 “Alliance Company budgets production of 23,000 units in January and 27,000 units in the February. Each finished unit requires 4 pounds of ...” in 📗 Business if the answers seem to be not correct or there’s no answer. Try a smart search to find answers to similar questions.
Search for Other Answers