Question

Requirements 1. Prepare a production budget for each month in the first quarter of the year, including production in units for each month and for the quarter. 2. Prepare a direct materials budget forth are a direct materials budget for the polypropylene for each month in the first quarter of the year, including the pounds of polypropylene required and the total cost of the polypropylene to be purchased. Print Print Done Done]

EXTRA INFO:

Number of planters to be sold

January. . . . . .3,900

February. . . . .3,700

March. . . . . . . .3,100

April. . . . . . . . .4,500

May. . . . . . . . .4,900

positive rating upon completion rewarded~

Answer 1

1)

Cleary Manufacturing
Production Budget
For the Months of January through March
	January	February	March	Quarter
Unit sales	3900	3700	3100	10700
Plus: Desired ending inventory	370	310	450	450
Total needed	4270	4010	3550	11150
Less: Beginning inventory	-390	-370	-310	-390
Units to produce	3880	3640	3240	10760

Calculation of Desired ending inventory of Planters

January= 3700*10%= 370

February= 3100*10%= 310

March= 4500*10%= 450

2)

Cleary Manufacturing
Direct Materials Budget
For the Months of January through March
	January	February	March	Quarter
Units to be produced	3880	3640	3240	10760
Multiply by: Quantity of direct materials needed per unit	3	3	3	3
Quantity needed for production	11640	10920	9720	32280
Plus: Desired ending inventory of direct materials	2184	1944	2724	2724
Total quantity needed	13824	12864	12444	35004
Less: Beginning inventory of direct materials	-2328	-2184	-1944	-2328
Quantity to purchase	11496	10680	10500	32676
Multiply by: Cost per pound	$0.25	$0.25	$0.25	$0.25
Total cost of direct materials purchases	$2874	$2670	$2625	$8169

Calculation of Desired ending inventory of direct materials

January= 10920*20%= 2184

February= 9720*20%= 1944

March= 4500+(4900*10%)-(4500*10%)= 4540*3*20%= 2724

Calculation of Beginning inventory of direct materials

January= 11640*20%= 2328