Academic Integrity: tutoring, explanations, and feedback — we don’t complete graded work or submit on a student’s behalf.

The production department of Hareston Company has submitted the following foreca

ID: 2442825 • Letter: T

Question

The production department of Hareston Company has submitted the following forecast of units to be produced by quarter for the upcoming fiscal year:


1st Quarter 2nd Quarter 3rd Quarter 4th Quarter
Units to be produced 4,000 5,000 6,000 3,000

--------------------------------------------------------------------------------

In addition, the beginning raw materials inventory for the first quarter is budgeted to be 4,000 pounds and the beginning accounts payable for the first quarter is budgeted to be $7,600.


Each unit requires four pounds of raw material that costs $3 per pound. Management desires to end each quarter with an inventory of raw materials equal to 25% of the following quarter's production needs. The desired ending inventory for the fourth quarter is 2,250 pounds. Management plans to pay for 70% of raw material purchases in the quarter acquired and 30% in the following quarter. Each unit requires 0.75 direct labor-hours and direct labor-hour workers are paid $13 per hour.


Requirement 1:
(a) Prepare the company's direct materials budget. (Input all amounts as positive values. Omit the "$" sign in your response.)

Hareston Company
Direct Materials Budget
1st Quarter 2nd Quarter 3rd Quarter 4th Quarter Year
Production needs
(Click to select)AddLess: Desired ending
inventory





Total needs
(Click to select)AddLess: Beginning
inventory





Raw materials to be purchased
Cost of raw materials to be purchased $
$
$
$
$


--------------------------------------------------------------------------------

Explanation / Answer

Excel! Quarter Production Inventory Purchased Acct Payable Labor Cost 0 4000 7600.00 1 4000 5000 17000 35700.00 165750.00 2 5000 6000 21000 59400.00 204750.00 3 6000 3000 21000 63000.00 204750.00 4 3000 2250 11250 42525.00 109687.50