E8-12 (Algo) Preparing Production, Direct Materials Purchases Budgets [LO 8-3b, c] Croy Incorporated has the following projected sales for the next five months: Month April May June July August Sales in Units 3,400 3,815 4,620 4,125 3,950 Croy's finished goods inventory policy is to have 50 percent of the next month's sales on hand at the end of each month. Direct materials cost $3.30 per pound, and each unit requires 2 pounds. Direct materials inventory policy is to have 50 percent of the next month's production needs on hand at the end of each month. Direct materials on hand at March 31 totaled 3,608 pounds. Required: 1. Determine budgeted production for April, May, and June. 2. Determine budgeted cost of direct materials purchased for April and May.

E8-12 (Algo) Preparing Production, Direct Materials Purchases Budgets [LO 8-3b, c] Croy Incorporated has the following projected sales for the next five months: Month April May June July August Sales in Units 3,400 3,815 4,620 4,125 3,950 Croy's finished goods inventory policy is to have 50 percent of the next month's sales on hand at the end of each month. Direct materials cost $3.30 per pound, and each unit requires 2 pounds. Direct materials inventory policy is to have 50 percent of the next month's production needs on hand at the end of each month. Direct materials on hand at March 31 totaled 3,608 pounds. Required: 1. Determine budgeted production for April, May, and June. 2. Determine budgeted cost of direct materials purchased for April and May.

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter8: Budgeting For Planning And Control

Section: Chapter Questions

Problem 15E: Palmgren Company produces consumer products. The sales budget for four months of the year is...

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