3. Direct materials purchases budget: Bathworks Direct Materials Purchases Budge

Question

3. Direct materials purchases budget: Bathworks Direct Materials Purchases Budget For the Year Ended December 31 Quarter 4 Year 3,200 5,000 5,100 17,200 ×4 ×4 ×4 × 4 Total production units Ounces per unit Total production needs in ounces Plus desired ounces of ending direct 3,900 15,600 materials inventory 2,560 3,600 3,600 Less desired ounces of beginning 3,120 ? 3,120 direct materials inventoryb Total ounces of direct materials to be purchased Cost per ounce Total cost of direct materials purchases 15,040 1,504 Desired ounces of ending direct materials inventory 20% of next quarter's budgeted production needs in ounces. "Desired ounces of beginning direct materials inventory 20% of current quarter's budgeted production needs in ounces

Explanation / Answer

Direct material purchase budget :

Quarter 1 Quarter 2 Quarter 3 Quarter 4 Year Total production units 3900 3200 5000 5100 17200 Ounce per unit 4 4 4 4 4 Total production needs in ounce 15600 12800 20000 20400 68800 Plus : Desired ounce of ending direct material inventory 2560 4000 4080 3600 3600 18160 16800 24080 24000 72400 Less: Desired ounce of beginning direct material inventory 3120 2560 4000 4080 3120 Total ounce of materials to be purchased 15040 14240 20080 19920 69280 Cost per ounce 0.10 0.10 0.10 0.10 0.10 Total direct material purchase 1504 1424 2008 1992 6928

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