**Transcription for Educational Website**---Three grams of musk oil are required for each bottle of Mink Caress, a popular perfume made by a company in western Siberia. The cost of the musk oil is $1.90 per gram. Budgeted quarterly production of Mink Caress is given below for Year 2 and the first quarter of Year 3:| | Year 2 | Year 3 ||---------------------|-------------------------|---------|| Budgeted production, in bottles | | || **Quarter** | **First** | **Second** | **Third** | **Fourth** | **First** || **Bottles** | 68,000 | 98,000 | 158,000 | 108,000 | 78,000 |The inventory of musk oil at the end of a quarter must equal 20% of the following quarter’s production needs. A total of 40,800 grams of musk oil will be on hand to start the first quarter of Year 2.**Required:** Prepare a direct materials budget for musk oil, by quarter and in total, for Year 2.**Mink Caress** **Direct Materials Budget - Year 2**| | Quarter | Year ||--------------------------------------|------------------------------------------|--------|| | **First** | **Second** | **Third** | **Fourth** | || Units of raw materials needed per unit of finished goods | | | | | || Units of raw materials needed to meet production | | | | | || Total units of raw materials needed | | | | | || Units of raw materials to be purchased | | | | | || Unit cost of raw materials | | | | | || Cost of raw materials to be purchased | | | | | |---**Diagram Explanation:**The table is designed to help calculate the direct materials budget needed for musk oil used in making Mink Caress perfume. The budget displays the planned quarterly production in units and leaves space to fill in details related to raw materials requirements and costs. The information includes:- Total production needs per quarter- Total units of raw materials needed- Units to be purchased, considering beginning inventory

Thew question is based on the concept of Cost Accounting.Direct materials purchase budget is based…

Three grams of musk oil are required for each bottle of Mink Caress, a popular perfume made by a company in western Siberia. The cost of the musk oil is $1.90 per gram. Budgeted quarterly production of Mink Caress is given below for Year 2 and the first quarter of Year 3: Units of raw materials needed per unit of finished goods Units of raw materials needed to meet production First 68,000 Total units of raw materials needed Second 98,000 Units of raw materials to be purchased Unit cost of raw materials Cost of raw materials to purchased Year 2 Required: Prepare a direct materials budget for musk oil, by quarter and in total, for Year 2. Budgeted production, in bottles The inventory of musk oil at the end of a quarter must equal 20% of the following quarter's production needs. A total of 40,800 grams of musk oil will be on hand to start the first quarter of Year 2. Third 158,000 Mink Caress Direct Materials Budget - Year 2 First Fourth 108,000 Second Quarter Year 3 First 78,000 Third Fourth Year

Three grams of musk oil are required for each bottle of Mink Caress, a popular perfume made by a company in western Siberia. The cost of the musk oil is $1.90 per gram. Budgeted quarterly production of Mink Caress is given below for Year 2 and the first quarter of Year 3: Units of raw materials needed per unit of finished goods Units of raw materials needed to meet production First 68,000 Total units of raw materials needed Second 98,000 Units of raw materials to be purchased Unit cost of raw materials Cost of raw materials to purchased Year 2 Required: Prepare a direct materials budget for musk oil, by quarter and in total, for Year 2. Budgeted production, in bottles The inventory of musk oil at the end of a quarter must equal 20% of the following quarter's production needs. A total of 40,800 grams of musk oil will be on hand to start the first quarter of Year 2. Third 158,000 Mink Caress Direct Materials Budget - Year 2 First Fourth 108,000 Second Quarter Year 3 First 78,000 Third Fourth Year

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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