ACG 2071 Fall 2017 Homework: Ch. 11. Master Budget Score: 0.25 of 1 pt Hw Score:

Question

ACG 2071 Fall 2017 Homework: Ch. 11. Master Budget Score: 0.25 of 1 pt Hw Score: 63.05%, 5.04 of 8 pts E9-20A (similar to) Question Help chip. To help to guard against stockouts of the computer chip, Gable Industries has a policy that states that the ending inventory of computor chips should be at least 25% of the following month's production needs. The production schedule for the first four months of the year is as follows: Gable Industries Direct Materials Budget 5,100 4,200 4,900 14,200 Units to be produced Multiply by: Quantity of direct materials needed per unit Quantity needed for production Plus: Desired ending inventory of direct materials Total quantity needed 20, 400 1 4200 6.800 19,600 56,800 4,100 24,600 21,700 23,700 4,900 4,100 60,900 Quantity to purchase edit All parts showing

Explanation / Answer

Direct material budget

$1

January February march quarter Units to be produced 5100 4200 4900 14,200 Direct material needed per unit 4 4 4 4 Quantity needed for production 20400 16800 19600 56,800 Plus desired ending inventory of direct material 4200 4900 4100 4100 Total quantity needed 24600 21700 23700 60900 Less beginning inventory of direct material 5100 4200 4900 5100 Quantity to purchase 19,500 $17,500 18800 55800 Cost per unit $1

$1

$1 $1 Cost of direct material purchases $19,500 $17500 18800 $55,800

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