A company is working on their budgets for the year 2021. They produce two unique products= Degreaser and Polish. The Degreaser has two Raw Materials: soap and baking soda. The Polish also has two Raw Materials: ketchup and salt. The table below has a few of their expectations for 2021. Expected Finished Goods to produce in 2021 Raw Materials used in production of Soap: 4.7 oz at $0.568 per oz 4 one unit of Degreaser Baking Soda: 7.4 oz at $0:390 per oz Raw Materials used in production of Ketchup: 1.0 oz at $0.550 per oz one unit of Polish Salt: 7.0 oz at $0.406 per oz Estimated beginning quantities of Raw Materials Inventory Desired ending quantities of Raw Materials Inventory Degreaser: 8,150 units Polish: 33,302 units Estimated beginning quantities of Finished Goods Inventory Desired ending quantities of, Finished Goods Inventory Soap: 1,970.9 oz Baking Soda: 2,334.0 oz Ketchup: 30,374.3 oz Salt: 46,104.5 oz Soap: 1,067.0 oz Baking Soda: 2,793.1 oz Ketchup: 35,470.5 oz Salt: 43,361.7 oz Degreaser: 12,117 units Polish: 22,388 units Degreaser: 14,970 units Polish: 23,688 units What is the dollar value of budgeted soap purchases? (Round your calculations to a level that makes sense for the situation. Enter your final answer to the nearest whole dollar/input code: 0)

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

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A company is working on their budgets for the year 2021. They produce two unique products:
Degreaser and Polish. The Degreaser has two Raw Materials: soap and baking soda. The Polish
also has two Raw Materials: ketchup and salt.
The table below has a few of their expectations for 2021.
Expected Finished Goods to
produce in 2021
Raw Materials used in production of Soap: 4.7 oz at $0.568 per oz 4
one unit of Degreaser
Baking Soda: 7.4 oz at $0:390 per oz
Raw Materials used in production of Ketchup: 1.0 oz at $0.550 per oz
one unit of Polish
Salt: 7.0 oz at $0.406 per oz
Estimated beginning quantities of
Raw Materials Inventory
Desired ending quantities of Raw
Materials Inventory
Degreaser: 8,150 units
Polish: 33,302 units
Estimated beginning quantities of
Finished Goods Inventory
Desired ending quantities of,
Finished Goods Inventory
Soap: 1,970.9 oz
Baking Soda: 2,334.0 oz
Ketchup: 30,374.3 oz
Salt: 46,104.5 oz
Soap: 1,067.0 oz
Baking Soda: 2,793.1 oz
Ketchup: 35,470.5 oz
Salt: 43,361.7 oz
Degreaser: 12,117 units
Polish: 22,388 units
Degreaser: 14,970 units
Polish: 23,688 units
What is the dollar value of budgeted soap purchases? (Round your calculations to a level that
makes sense for the situation. Enter your final answer to the nearest whole dollar/input code: 0)

Expert Solution

Step 1: Introduction to Material Purchase Budget

According to the question given, we need to prepare the material purchase cost budget.

MATERIAL PURCHASE BUDGET

Materials Purchase Budget refers to the budget statement that shows quantities of direct materials needed to produce the finished product in the budget period of an organization.

The Material Purchase Budget Performed is determined using the following formula:

= $(Raw Material consumed in Production + Ending Raw Material Inventory - Beginning Raw Material Inventory).

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