Zira Company reports the following production budget for the next four months. Each finished unit requires five pounds of direct materials, and the company wants to end each month with direct materials inventory equal to 40% of next month's production needs. Beginning direct materials inventory for April was 1,244 pounds. Direct materials cost $4 per pound. Prepare a direct materials budget for April, May, and June. (Round your answers to the nearest whole number.) Units to produce April 622 May 650 June 656 July 636 ZIRA COMPANY Direct Materials Budget April May June Units to produce 622 650 656 units Materials required per unit 5 5 Materials needed for production (pounds) 3,110 3,250 5 pounds 3,280 pounds Add: Desired ending materials inventory (pounds) 1,300 1,312 pounds Total materials required (pounds) 4,410 4,562 3,280 pounds Materials to purchase (pounds) Cost of direct materials purchases 0 $ 0 $ 0
Zira Company reports the following production budget for the next four months. Each finished unit requires five pounds of direct materials, and the company wants to end each month with direct materials inventory equal to 40% of next month's production needs. Beginning direct materials inventory for April was 1,244 pounds. Direct materials cost $4 per pound. Prepare a direct materials budget for April, May, and June. (Round your answers to the nearest whole number.) Units to produce April 622 May 650 June 656 July 636 ZIRA COMPANY Direct Materials Budget April May June Units to produce 622 650 656 units Materials required per unit 5 5 Materials needed for production (pounds) 3,110 3,250 5 pounds 3,280 pounds Add: Desired ending materials inventory (pounds) 1,300 1,312 pounds Total materials required (pounds) 4,410 4,562 3,280 pounds Materials to purchase (pounds) Cost of direct materials purchases 0 $ 0 $ 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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Concept explainers
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.
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Transcribed Image Text:Zira Company reports the following production budget for the next four months. Each finished unit requires five pounds of direct
materials, and the company wants to end each month with direct materials inventory equal to 40% of next month's production needs.
Beginning direct materials inventory for April was 1,244 pounds. Direct materials cost $4 per pound.
Prepare a direct materials budget for April, May, and June. (Round your answers to the nearest whole number.)
Units to produce
April May
622 650
June
July
656
636
ZIRA COMPANY
Direct Materials Budget
April
May
June
Units to produce
Materials required per unit
622
650
656 units
5
5
Materials needed for production (pounds)
3,110
3,250
5 pounds
3,280 pounds
Add: Desired ending materials inventory (pounds)
1,300
1,312
pounds
Total materials required (pounds)
4,410
4,562
3,280 pounds
Materials to purchase (pounds)
Cost of direct materials purchases
$
0 $
0 $
0
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