Rida, Inc., a manufacturer in a seasonal industry, is preparing its direct mater

Question

Rida, Inc., a manufacturer in a seasonal industry, is preparing its direct materials budget for the second quarter. It plans production of 241,000 units in the second quarter and 278,500 units in the third quarter. Raw material inventory is 68,500 pounds at the beginning of the second quarter. Other information follows:

Prepare a direct materials budget for the second quarter.

Direct materials Each unit requires 0.50 pounds of a key raw material, priced at $191 per pound. The company plans to end each quarter with an ending inventory of materials equal to 50% of next quarter’s budgeted materials requirements.

Explanation / Answer

Units to be produced 241000 Units Materials requirement per unit 0.5 pounds Materials needed for production(pounds) 120500 pounds Add: Budgeted ending inventory (pounds) 69625 pounds Total materials requirements (pounds) 190125 pounds Less: Beginning inventory (pounds) 68500 pounds Materials to be purchased (pounds) 121625 pounds Material price per pounds 191 pounds Total cost of direct materials purchases 23230375 per pound

Related Questions

Navigate

• Browse (All)
• Browse R
• Subjects

---

---

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