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Three grams of musk oll are required for each bottle of Mink Caress, a popular perfume made by a company in western Siberia. The cost of the musk oil is $2.10 per gram. Budgeted quarterly production of Mink Caress is given below for Year 2 and the first quarter of Year 3: Required production in units of finished goods Units of raw materials needed per unit of finished goods Units of raw materials needed to meet production Add: Desired units of ending raw materials inventory Total units of raw materials needed First 70,000 Less: Units of beginning raw materials inventory Units of raw materials to be purchased Required: Prepare a direct materials budget for musk oil, by quarter and in total, for Year 2. Unit cost of raw materials Cost of raw materials to purchased Budgeted production, in bottles The inventory of musk oil at the end of a quarter must equal 20% of the following quarter's production needs. A total of 42,000 grams of musk oil will be on hand to start the first quarter of Year 2. Second 100,000 Year 2 O S Mink Caress Direct Materials Budget-Year 2 O Third 160,000 Answer is not complete. First 70,000 30 210,000 60,000 270,000 Second Fourth 110,000 Quarter 100,000 30 300,000 96,000 396,000 Third 160,000 30 Year 3 First 80,000 480,000 66,000 546,000 Fourth 110,000 30 330,000 48,000 378,000 Year 440,000 30 1,320,000

Three grams of musk oll are required for each bottle of Mink Caress, a popular perfume made by a company in western Siberia. The cost of the musk oil is $2.10 per gram. Budgeted quarterly production of Mink Caress is given below for Year 2 and the first quarter of Year 3: Required production in units of finished goods Units of raw materials needed per unit of finished goods Units of raw materials needed to meet production Add: Desired units of ending raw materials inventory Total units of raw materials needed First 70,000 Less: Units of beginning raw materials inventory Units of raw materials to be purchased Required: Prepare a direct materials budget for musk oil, by quarter and in total, for Year 2. Unit cost of raw materials Cost of raw materials to purchased Budgeted production, in bottles The inventory of musk oil at the end of a quarter must equal 20% of the following quarter's production needs. A total of 42,000 grams of musk oil will be on hand to start the first quarter of Year 2. Second 100,000 Year 2 O S Mink Caress Direct Materials Budget-Year 2 O Third 160,000 Answer is not complete. First 70,000 30 210,000 60,000 270,000 Second Fourth 110,000 Quarter 100,000 30 300,000 96,000 396,000 Third 160,000 30 Year 3 First 80,000 480,000 66,000 546,000 Fourth 110,000 30 330,000 48,000 378,000 Year 440,000 30 1,320,000

Cornerstones of Cost Management (Cornerstones Series)
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 17E: Crescent Company produces stuffed toy animals; one of these is Arabeau the Cow. Each Arabeau takes...
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Three grams of musk oil are required for each bottle of Mink Caress, a popular perfume made by a company in western Siberia. The cost of the musk oil is $2.10 per gram. Budgeted quarterly production of Mink Caress is given below for Year 2 and the first quarter of Year 3: First 70,000 Required production in units of finished goods Units of raw materials needed per unit of finished goods Units of raw materials needed to meet production Add: Desired units of ending raw materials inventory Total units of raw materials needed Less: Units of beginning raw materials inventory Units of raw materials to be purchased Unit cost of raw materials Cost of raw materials to purchased Second 100,000 Required: Prepare a direct materials budget for musk oil, by quarter and in total, for Year 2. Year 2 Budgeted production, in bottles The inventory of musk oil at the end of a quarter must equal 20% of the following quarter's production needs. A total of 42,000 grams of musk oil will be on hand to start the first quarter of Year 2. O >> Mink Caress Direct Materials Budget - Year 2 S Third 160,000 Answer is not complete. First 70,000✔ 3 210,000 60,000 270,000 Second Fourth 110,000 Quarter 100,000 30 300,000 96,000 396,000 Third 160,000 3 480,000 33 66,000✔ 546,000 Year 3 First 80,000 Fourth 110,000 30 330,000 48,000 378,000 Year 440,000 3 1,320,000
Transcribed Image Text:Three grams of musk oil are required for each bottle of Mink Caress, a popular perfume made by a company in western Siberia. The cost of the musk oil is $2.10 per gram. Budgeted quarterly production of Mink Caress is given below for Year 2 and the first quarter of Year 3: First 70,000 Required production in units of finished goods Units of raw materials needed per unit of finished goods Units of raw materials needed to meet production Add: Desired units of ending raw materials inventory Total units of raw materials needed Less: Units of beginning raw materials inventory Units of raw materials to be purchased Unit cost of raw materials Cost of raw materials to purchased Second 100,000 Required: Prepare a direct materials budget for musk oil, by quarter and in total, for Year 2. Year 2 Budgeted production, in bottles The inventory of musk oil at the end of a quarter must equal 20% of the following quarter's production needs. A total of 42,000 grams of musk oil will be on hand to start the first quarter of Year 2. O >> Mink Caress Direct Materials Budget - Year 2 S Third 160,000 Answer is not complete. First 70,000✔ 3 210,000 60,000 270,000 Second Fourth 110,000 Quarter 100,000 30 300,000 96,000 396,000 Third 160,000 3 480,000 33 66,000✔ 546,000 Year 3 First 80,000 Fourth 110,000 30 330,000 48,000 378,000 Year 440,000 3 1,320,000
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