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Reaser Corporation makes one product.AprilMayJuneJulyBudgeted unit sales8,4008,70012,60013,100-Each unit of finished goods requires 4 pounds of raw materials. The ending finished goods inventory equals 10% of the following month's sales. The ending raw materials inventory equals 40% of the following month's raw materials production needs. If 50,600 pounds of raw materials are required for production in June, then the budgeted raw material purchases for May is closest to:A) 56,600 poundsB) 42,056 poundsC) 71,144 poundsD) 36,360 pounds

Sagot :

Answer: 42056 pounds

Explanation:

The budgeted raw material purchases for May will be:

Budgeted unit sale = 8700

Add: desired ending inventory = 10% × 12600 = 1260

Total needs = 8700 + 1260 = 9960

Less: Beginning inventory = 10% × 8700 = (870)

Production in May = 9960 - 870 = 9090

Pounds for material = 4

Material for production = 9090 × 4 = 36360

Add: Desired ending inventory of raw material = 20240

Total needs = 36360 + 20240 = 56600

Less: Beginning ending inventory of raw material = (14544)

Raw material purchase = 42056

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