Question

Yandell expects to produce 1 comma 950 units in January and 2 comma 110 units in February . The company budgets 5 pounds per unit of direct materials at a cost of $ 50 per pound. Indirect materials are insignificant and not considered for budgeting purposes. The balance in the Raw Materials Inventory account​ (all direct​ materials) on January 1 is 5 comma 100 pounds. Yandell desires the ending balance in Raw Materials Inventory to be 80 ​% of the next​ month's direct materials needed for production. Desired ending balance for February is 4 comma 700 pounds. Prepare Yandell ​'s direct materials budget for January and February .

Answer 1

January February

Budgeted Material Cost $65,450 $340,500

Step-by-step explanation:

Direct materials budget for January and February .

January February

Production 1,950 units 2,110 units

Production Material needs (pounds) 9,750 10,550

Add Budgeted Closing Materials 8,440 4,700

Total Materials needed 18,190 15,250

Less Budgeted Opening Materials (5,100) (8,440)

Budgeted Materials 13,090 6,810

Cost per material = $ 50 per pound

Budgeted Material Cost $65,450 $340,500