Tug Company makes and sells a single product. It takes 2.5 pounds of direct materials to produce one unit of this product. Budgeted production for the next four months is given below: September October November December budgeted units to be produced 27,300 59,400 35,800 77,200 The company wants to maintain monthly ending inventories of direct materials equal to 60% of the following month's production needs. The cost of direct materials is $3.25 per pound. The company is in the process of preparing a direct materials purchases budget. Calculate the cost of direct materials budgeted to be purchased in November.

Tug Company makes and sells a single product. It takes 2.5 pounds of direct materials to produce one unit of this product. Budgeted production for the next four months is given below: September October November December budgeted units to be produced 27,300 59,400 35,800 77,200 The company wants to maintain monthly ending inventories of direct materials equal to 60% of the following month's production needs. The cost of direct materials is $3.25 per pound. The company is in the process of preparing a direct materials purchases budget. Calculate the cost of direct materials budgeted to be purchased in November.

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter7: Budgeting

Section: Chapter Questions

Problem 5EA: Sunrise Poles manufactures hiking poles and is planning on producing 4,000 units in March and 3,700...

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