Carter Company budgets on an annual basis for its fiscal year. The following beg

Question

Carter Company budgets on an annual basis for its fiscal year. The following beginning and ending inventory levels are planned for the fiscal year of July 1, 2014 to June 30, 2015:

June 30, 2015 June 30, 2014

Raw Materials 3,000 kilos 4,000 kilos

Three kilos of raw materials are needed to produce each unit of finished product. If Carter plans to produce 560,000 units during the 2014-2015 fiscal year, how many kilos of materials will the company need to purchase for its production during the year? (Answer: 1,679,000)

Explanation / Answer

Total no of units produced = 560000

Total raw material required = 560000*3 = 1680000

Total material required to be purchased = Opening Inventory + Material required for final product - Closing Inventory

= 3000 + 1680000- 4000 = 1679000 kgs of material should be purchased

Related Questions

Navigate

• Browse (All)
• Browse C
• Subjects

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.