Big Company manufactures keyboards. Management wishes to develop budgets for the
ID: 2389729 • Letter: B
Question
Big Company manufactures keyboards. Management wishes to develop budgets for the upcoming quarter based on the following data:sales in units 800 units
selling price per unit $60
inventory at beginning of the quarter (FG) 80 units
desired ending inventory (FG) 130 units
direct materials per unit 4 ounces plastic
plastic inventory at beginning of quarter 136 ounces
desired ending inventory of plastic 84 ounces
plastic cost $.18 per ounce
Compute the budgeted quantity of plastic which needs to be purchased for the next quarter.
850 ounces.
3,348 ounces.
3,452 ounces.
798 ounces.
902 ounces.
Explanation / Answer
800 sales +130 desired ending FG inventory - 80 beginning FG inventory = 850 units produced 3,400 plastic needed (850*4) + 84 desired ending plastic inv. - 136 beginning plastic invnetory = 3348 plastic to purchase ANswer: 3,348 ounces
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