Question

*76) Picture Pretty manufactures picture frames. Sales for August are expected to be 10,000 units of various sizes. Historically, the average frame requires four feet of framing, one square foot of glass, and two square feet of backing. Beginning inventory includes 1,500 feet of framing, 500 square feet of glass, and 500 square feet of backing. Current prices are $0.90 per foot of framing, $8.00 per square foot of glass, and $4 per square foot of backing. Ending inventory of materials should be 150% of beginning inventory. Purchases are paid for in the month acquired.*

Required:
a. Determine the quantity of framing, glass, and backing that is to be purchased during August.
b. Determine the total costs of direct materials for August purchases.

Answer 1

To purchase materials for August, Picture Pretty needs to acquire 40,750 feet of framing, 10,250 square feet of glass, and 20,250 square feet of backing. The total cost for these materials is $199,675, calculated by summing the cost of framing, glass, and backing based on their respective current prices.

Step-by-step explanation:

To determine the quantity of materials to be purchased, we must first calculate the required materials for production and adjust for the desired ending inventory. The calculations are as follows:

• Total materials needed for production: 10,000 frames * 4 feet = 40,000 feet of framing, 10,000 frames * 1 sq ft = 10,000 sq ft of glass, and 10,000 frames * 2 sq ft = 20,000 sq ft of backing.
• Desired ending inventory: Beginning inventory * 150% = 1,500 feet * 1.5 = 2,250 feet of framing, 500 sq ft * 1.5 = 750 sq ft of glass, and 500 sq ft * 1.5 = 750 sq ft of backing.

The materials to be purchased are calculated by taking the total materials needed, adding the desired ending inventory, and subtracting the beginning inventory:

• Framing: 40,000 + 2,250 - 1,500 = 40,750 feet
• Glass: 10,000 + 750 - 500 = 10,250 sq ft
• Backing: 20,000 + 750 - 500 = 20,250 sq ft

Next, we calculate the total cost of materials to be purchased:

• Framing cost: 40,750 feet * $0.90/foot = $36,675
• Glass cost: 10,250 sq ft * $8.00/sq ft = $82,000
• Backing cost: 20,250 sq ft * $4.00/sq ft = $81,000

The total cost of direct materials for August purchases is calculated by summing the costs of framing, glass, and backing:

Total August Direct Materials Cost: $36,675 + $82,000 + $81,000 = $199,675