w the production schedule.) s budget for als budget b irect materia uction entory of dire Data table January... February.. March April *****. Stuffed animals to be produced 5,300 4,600 4,400 4,800 Print Done - X he dollar amc

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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the
first four months of the year is as follows:
ew the production schedule.)
als budget for
rials budget b
direct materia
oduction
ventory of dire
Data table
January.....
February ....
March
April
*****
Stuffed animals' to be produced
5,300
4,600
4,400
4,800
Print
Done
-X
he dollar amount of the
Transcribed Image Text:the first four months of the year is as follows: ew the production schedule.) als budget for rials budget b direct materia oduction ventory of dire Data table January..... February .... March April ***** Stuffed animals' to be produced 5,300 4,600 4,400 4,800 Print Done -X he dollar amount of the
Smith Industries manufactures a popular interactive stuffed animal for children that requires three computer chips inside each toy. The company pays $1 for each computer chip. To help to guard
against stockouts of the computer chip, Smith Industries has a policy that states that the ending inventory of computer chips should be at least 30% of the following month's production needs. The
production schedule for the first four months of the year is as follows
(Click the icon to view the production schedule.)
Requirement
Prepare a direct materials budget for the first quarter that shows both the number of computer chips needed and the dollar amount of the purchases in the budget
Prepare the direct materials budget by first calculating the total quantity needed, then complete the budget.
Smith Industries
Direct Materials Budget
For the Months of January through March
January
Units to be produced
Multiply by: Quantity of direct materials needed per unit
Quantity needed for production
Plus: Desired ending inventory of direct materials
Total quantity needed
February March
Quarter
Transcribed Image Text:Smith Industries manufactures a popular interactive stuffed animal for children that requires three computer chips inside each toy. The company pays $1 for each computer chip. To help to guard against stockouts of the computer chip, Smith Industries has a policy that states that the ending inventory of computer chips should be at least 30% of the following month's production needs. The production schedule for the first four months of the year is as follows (Click the icon to view the production schedule.) Requirement Prepare a direct materials budget for the first quarter that shows both the number of computer chips needed and the dollar amount of the purchases in the budget Prepare the direct materials budget by first calculating the total quantity needed, then complete the budget. Smith Industries Direct Materials Budget For the Months of January through March January Units to be produced Multiply by: Quantity of direct materials needed per unit Quantity needed for production Plus: Desired ending inventory of direct materials Total quantity needed February March Quarter
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