Prepare Bates & Hill's direct materials purchases budget for the first quarter. (Enter price per pound to 2 decimal places, e.g. 52.75.) Marcy Jones, Bates & Hill Fabricators' purchasing manager, has just received the company's production budget for the first quarter. January February March Quarter Budgeted unit sales 25,000 28,000 32,000 85,000 + Budgeted ending inventory 5,600 6,400 6,800 6,800 Total units required 30,600 34,400 38,800 91,800 - Beginning inventory 3,200 5,600 6,400 3,200 Budgeted production 27,400 28,800 32,400 88,600 Budgeted sales for April is 34,000 units and for May is 26,000 units. Each brick requires 6 pounds of clay, and Marcy expects to pay $1.50 per pound of clay in the coming year. Company policy requires an ending direct materials inventory each month that will meet 10% of the following month's production needs. Company policy requires an ending finished goods inventory each month that will meet 20% of the following month’s sales volume. Marcy expects to have 15,000 pounds of clay at a cost of $22,500 in inventory at the beginning of the year
Master Budget
A master budget can be defined as an estimation of the revenue earned or expenses incurred over a specified period of time in the future and it is generally prepared on a periodic basis which can be either monthly, quarterly, half-yearly, or annually. It helps a business, an organization, or even an individual to manage the money effectively. A budget also helps in monitoring the performance of the people in the organization and helps in better decision-making.
Sales Budget and Selling
A budget is a financial plan designed by an undertaking for a definite period in future which acts as a major contributor towards enhancing the financial success of the business undertaking. The budget generally takes into account both current and future income and expenses.
Prepare Bates & Hill's direct materials purchases budget for the first quarter. (Enter price per pound to 2 decimal places, e.g. 52.75.)
Marcy Jones, Bates & Hill Fabricators' purchasing manager, has just received the company's production budget for the first quarter.
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January
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February
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March
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Quarter
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||||||
|---|---|---|---|---|---|---|---|---|---|
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Budgeted unit sales
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25,000 | 28,000 | 32,000 | 85,000 | |||||
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+ Budgeted ending inventory
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5,600 |
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6,400 |
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6,800 |
|
6,800 | ||
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Total units required
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30,600 | 34,400 | 38,800 | 91,800 | |||||
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- Beginning inventory
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3,200 | 5,600 | 6,400 | 3,200 | |||||
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Budgeted production
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27,400 |
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28,800 |
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32,400 |
|
88,600 |
Budgeted sales for April is 34,000 units and for May is 26,000 units.
Each brick requires 6 pounds of clay, and Marcy expects to pay $1.50 per pound of clay in the coming year. Company policy requires an ending direct materials inventory each month that will meet 10% of the following month's production needs. Company policy requires an ending finished goods inventory each month that will meet 20% of the following month’s sales volume. Marcy expects to have 15,000 pounds of clay at a cost of $22,500 in inventory at the beginning of the year
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