Purchases of raw materials
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The following are budgeted data:
January February March
Sales in units 16,000 19,000 17,000
Production in units 20,000 18,000 14,000
One pound of material is required for each finished unit. The inventory of materials at the end of each month should equal 20% of the following month's production needs. Purchases of raw materials for February should be:
18,800 pounds
17,200 pounds
18,000 pounds
17,600 pounds.
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Solution Summary
This provides the steps to calculate the Purchases of raw materials.
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