Please show all work. Please show all work. Croy Inc. has the following projecte

Question

Please show all work. Please show all work. Croy Inc. has the following projected sales for the next five months May une July August 3,810 4,560 ,125 3,970 Croy's finished goods inventory policy is to have 60 percent of the next morthi's sales on hand at the end of each morth Diect material costs $2 80 prpoud, and each unt reqaires 2 pourds. Raw maserials envertory policy is to have 50 pencent of the next month's production needs on hand at the end of each month Raw materials on hand at March 31 totaled 3,722 pounds Required 1. Determine budgeted production for Apnil, May, and June. (Do not round your intermediate caleulations and round your final answer to the nearest whole number) 2. Determine the busdgeted cost of materials purchased for April, May, and June (Use rounded Budgeted Production units in intermediate calculations Round your answers to 2 decimal places ) Budgeted Cost of Maenal

Explanation / Answer

Finished goods inventory policy = 60 % of next month sale

Direct material cost = $ 2.80/pound

Raw material required per unit = 2 pound

raw material inventory policy is to have 50% of the next month production

Raw material on hand at 31st march = 3722 pounds

1. Calculation of budgeted production -

2. Calculation of Budgeted cost of material purcahsed -

all formulaes are given in table itself.

Please note all values are in $.

In case of any clarification required please comment.

April May June July Aug. Projected Sales in units 3590 3810 4560 4125 3970 Budgeted Production (Units) April May June opening finished goods - 60% of sales 2154 2286 2736 2475 Budgetd production (Projected sales - Opening FG) + next month sale*60% 3722 4260 4299 4032

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