Question

vvDallas Industries has adopted the following production budgetfor the first 4 months of 2014.

Month

 

Units

 

Month

 

Units

January

 

10,320

 

March

 

5,200

February

 

8,390

 

April

 

4,320

 

Each unit requires 4 pounds of raw materials costing $3 per pound.On December 31, 2013, the ending raw materials inventory was 9,280pounds. Management wants to have a raw materials inventory at theend of the month equal to 20% of next month’s productionrequirements.

Prepare a direct materials purchases budget by month for the firstquarter.

 



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