Question

ture Pretty manufactures picture frames. Sales for August are expected to be 10,000 units of various Historically, the average frame requires four feet of fram ing, one square foot of glass, and two square feet of backing. Beginning inventory includes 1,500 feet of framing, 500 square feet of glass, and 500 square feet of backing. Current prices are $0.90 per foot of framing, $8.00 per square foot of glass and $4 per square foot of backing. Ending inventory of materials should be 150% of beginnin inventory. Purchases are paid for in the month acquired. Determine the quantity of framing, glass, and backing that is to be purchased during Aug Points) Determine the total costs of direct materials for August purchases. REQUIRED 1. (3 Points) 2.

Answer 1

Answers

• All working forms part of the answer
• Requirement 1

Quantity of Framing to be purchased = 40,750 feet
Quantity of Glass to be purchased = 10,250 square feet
Quantity of Backing = 20,250 square feet

--Working

Working		Framing	Glass	Backing
A	Expected sales	10,000	10,000	10,000
B	Requirement per unit	4 feet	1 square foot	2 square foot
C = A x B	Total requirement	40,000 feet	10,000 square feet	20,000 square feet
D	Beginning Inventory available	1,500 feet	500	500
E = D x 150%	Ending inventory desired	2,250 feet	750	750
F = C + E - D	Quantity to be purchased = ANSWER	40,750 feet	10,250 square feet	20,250 square feet

• Requirement 2

Total cost = $ 199,675 [36675 + 82000 + 81000]

Working		Framing	Glass	Backing
A	Quantity to be purchased	40,750	10,250	20,250
B	Price per unit	$                0.90	$                     8.00	$               4.00
C = A x B	Total cost of purchase	$      36,675.00	$           82,000.00	$    81,000.00