Answered

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General Manufacturing expects to have 40,000 pounds of raw materials inventory on hand on June 30, the end of the current year. The company has budgeted the following production for the first four months of the coming year:
Production (units)
July 100,000
August 120,000
September 150,000
October 110,000
General Manufacturing desires each month's ending raw materials inventory to be 20% of the following month's production needs. A finished unit requires two pounds of raw materials. General Manufacturing's budgeted purchases of materials for September is:
a. 60,000 lbs.
b. 248,000 lbs.
c. 228,000 lbs.
d. 284,000 lbs.
e. 300,000 lbs.

Sagot :

Answer:

d. 284,000 lbs.

Explanation:

The computation of the budgeted purchase of material for the september month is as follows

= Raw material needed for production + closing stock - opening stock

= (150,000 × 2) + (110,000 × 2 × 20%) - 60,000

= 300,000 + 44,000 - 60,000

= 284,000 lbs

Hence, the budgeted purchase of material for the september month is 284,000 lbs

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