chapter 7 lecture notes

1013000 packing boxes 838400 810400 total purchases

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Unformatted text preview: ule Amarillo pays vendors as follows: 40% in the first month 60% in the second month We did not prepare a Direct Materials Purchase Budget – we prepared the production budget. However, from the info given before, we can create the Direct Materials Purchase Budget. Are you up to the challenge???!!! Cash Budget – Operating Outflows – Direct Materials Standard grade plasGc Quarter 1 Quarter 2 Quarter 3 Quarter 4 Total Lots used in producKon 1,575 1,550 2,100 2,790 8,015 + Desired ending inventory 155 210 279 100 744 = Total requirements 1,730 1,760 2,379 2,890 8,759 - Beginning inventory 65 155 210 279 709 = Lots to be purchased 1,665 1,605 2,169 2,611 8,050 x Purchase price per lot $600 $600 $600 $600 $600 = Purchases $999,000 $963,000 $1,301,400 $1,566,600 $4,830,000 Special grade plasGc Quarter 1 Quarter 2 Quarter 3 Quarter 4 Total Lots used in producKon 425 410 520 650 2,005 + Desired ending inventory 41 52 65 25 183 = Total requirements 466 462 585 675 2,188 - Beginning inventory 30 41 52 65 188 = Lots to be purchased...
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