Question

Donaldson Manufacturing produces self-watering planters for use in upscale retail establishments Sales projections for the first five months of the upcoming year show the estimated unit sales of the planters each month to be as follows: Click the icon to view additional information) Inventory at the start of the year was 800 planters. The desired Inventory of planters at the end of each month should be equal to 25% of the following month's budgeted sales. Each planter requires two pounds of polypropylene (a type of plastic). The company wants to have 20% of the polypropylene required for next month's production on hand at the end of each month. The polypropylene costs $0.10 per pound Read the requirements Requirement 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. Donaldson Manufacturing Production Budget For the Months of January through March January February March Quarter Unit sales Plus Desired ending inventory Total needed Less: Beginning inventory Units to produce Requirement 2. Prepare a direct materiale 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 Start by preparing the direct materials budget through the total quantity needed, then complete the budget Donaldson Manufacturing Direct Materials Budget Enter any number in the edit fields and then continue to the next question

Answer 1

1.

Donaldson Manufacturing Production Budget
	January	February	March	Quarter	April
Unit Sales	3,200	3,000	3,500	9,700	4,300
Plus: Desired Ending Inventory	750	875	1,075	1,075	1,150
Total needed	3,950	3,875	4,575	10,775	5,450
Less: Beginning Inventory	800	750	875	800	1,075
Units to produce	3,150	3,125	3,700	9,975	4,375

2.

Donaldson Manufacturing Direct Materials Budget
	January	February	March	Quarter	April
Units to be produced	3,150	3,125	3,700	9,975	4,375
Qty. of direct materials needed per unit	2 lbs.	2 lbs.	2 lbs.	2 lbs.	2 lbs.
Quantity needed for production	6,300 lbs.	6,250 lbs.	7,400 lbs.	19,950 lbs.	8,750
Plus: Desired ending inventory of direct materials	1,250	1,480	1,750	1,750
Total quantity needed	7,550	7,730	9,150	21,700
Less: Beginning inventory of direct materials	1,260	1,250	1,480	1,260
Quantity to purchase	6,290	6,480	7,670	20,440
Cost per pound	$ 0.10	$ 0.10	$ 0.10	$ 0.10
Total cost of direct material purchases	$ 629	$ 648	$ 767	$ 2,044