Mandy Corporation sells a single product. Budgeted sales for the year are antici

Question

Mandy Corporation sells a single product. Budgeted sales for the year are anticipated to be 661,000 units, estimated beginning inventory is 105,000 units, and desired ending inventory is 81,000 units. The quantities of direct materials expected to be used for each unit of finished product are given below. Material A 0.50 lb. per unit $0.67 per pound Material B 1.00 lb. per unit @ $1.53 per pound Material 1.20 lb, per unit @ $1.15 per pound The dollar amount of Material B used in production during the year is $779,688 $1,169,532 $1,461,915 $974,610

Explanation / Answer

Required production=661000-105000+81000= 637000 The dollar amount of Material B=637000*1*1.53= $974610 Option 4 is correct

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