Question

ucker Company makes chairs. Tucker has the following production budget for January - March. January February March Units Produced 9,258 10,558 12,809 Each chair produced uses 3 board feet of wood. Management wants ending inventory levels of raw materials to equal 20% of the production needs (in wood) for the next month. How many board feet of wood does Tucker need to purchase in February? Round your answer to the nearest whole number. Don't round any intermediate calculations.

Answer 1

The board feet of wood needed to be purchased in February is 33025 board feet of wood.

Step-by-step explanation:

The February production will require enough board feet of wood to cover the budgeted production for February, after deducting the opening inventory, and board feet that will enable Tucker to meet 20% of March's production requirement.

The opening inventory of board feet will be:

• Budgeted production in units for February = 10558 chairs

• Each chair require 3 board feet so, raw material requirement for February is 10558 * 3 = 31674 board feet of wood.
• Out of 31674, 20% will be available as opening inventory. So, opening inventory is 31674 * 0.2 = 6334.8 board feet.

Remaining raw material needed for February production = 31674 - 6334.8 = 25339.2 board feet

Raw material required for ending inventory, which is equal to meet 20% of March's production requirement = 12809 * 3 * 0.2 = 7685.4

Total board feet of wood needed to be purchased in February =

25339.2 + 7685.4 = 33024.6 rounded off to 33025 board feet of wood