Ramos Company provides the following budgeted production for the next four months. Units to produce April 500 May June July 630 600 600 Each finished unit requires 6 pounds of direct materials. The company wants to end each month with direct materials inventory equal to 25% of next month's production needs. Beginning direct materials inventory for April was 750 pounds. Direct materials cost $3 per pound. Prepare a direct materials budget for April, May, and June. RAMOS COMPANY Direct Materials Budget April Units to produce Materials required per unit Materials needed for production (pounds) Add: Desired ending materials inventory (pounds) Total materials required (pounds) Materials to purchase (pounds) Materials cost per pound Cost of direct materials purchases 500 6 3,000 May June 630 600 units 6 6 pounds 3,780 3,600 pounds 0

Ramos Company provides the following budgeted production for the next four months. Units to produce April 500 May June July 630 600 600 Each finished unit requires 6 pounds of direct materials. The company wants to end each month with direct materials inventory equal to 25% of next month's production needs. Beginning direct materials inventory for April was 750 pounds. Direct materials cost $3 per pound. Prepare a direct materials budget for April, May, and June. RAMOS COMPANY Direct Materials Budget April Units to produce Materials required per unit Materials needed for production (pounds) Add: Desired ending materials inventory (pounds) Total materials required (pounds) Materials to purchase (pounds) Materials cost per pound Cost of direct materials purchases 500 6 3,000 May June 630 600 units 6 6 pounds 3,780 3,600 pounds 0

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter8: Budgeting For Planning And Control

Section: Chapter Questions

Problem 15E: Palmgren Company produces consumer products. The sales budget for four months of the year is...

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