Question

Each finished unit requires five pounds of raw materials and the company wants to end each month with raw materials inventory equal to 20% of next month's production needs. Beginning raw materials inventory for Apri was 556 pounds. Assume direct materials cost $5 per pound

Zira Co. reports the following production budget for the next four months. April 556 May 610 June 588 July 568 Production (units) Each finished unit requires five pounds of raw materials and the company wants to end each month with raw materials inventory equal to 20% of next month's production needs. Beginning raw materials inventory for April was 556 pounds. Assume direct materials cost $5 per pound. Prepare a direct materials budget for April, May, and June. (Round your intermediate calculations and final answers to the nearest whole dollar amount.) June ZIRA CO. Direct Materials Budget For April, May, and June April May Budgeted production (units) Materials requirements per unit Materials needed for production (lbs) Budgeted ending inventory (lbs) Total materials requirements (lbs) Beginning inventory (lbs) Materials to be purchased (lbs) Cost per lb Total budgeted direct materials cost

Answer 1

ZIRA Direct Material Budget For the April May and June April May June Budgeted Prodcution 556 610 588 Units Materila required per Unit 5 5 5 lbs Materila need for Prodcution (lbs) 2780 3050 2940 lbs ADD:Budgeted ending inventory 588 568 lbs Total Material Required 3390 3638 3508 lbs Less: Beginnin invneotry 610 588 lbs Direct Material Purchases 2834 3028 2920 lbs Cost per lb 5 5 5 Per lbs Totalbudgeted direct Material Cost 14170 15140 14600 610 556