Raw Materials Purchases Budget 2020 July August September TOTAL October Units Produced Yards of RM Required...

Raw Materials Purchases Budget
	2020
	July	August	September	TOTAL	October
Units Produced
Yards of RM Required Per Unit of FG
Total Yards Used in Production
Plus: Desired Yards in Ending Inventory
Total Yards Required
Less: Yards in Beginning Inventory
RAW MATERIALS PURCHASES (YARDS)
Cost per Yard
RAW MATERIALS PURCHASES (COST)

Please fill the raw material budget
Each mask is referred to as a finished good unit. Although the company makes both adult and children’s sizes, each mask will be treated the same.
Budgeted sales in units are as follows:
- July – 222,000 masks
- August – 290,000 masks
- September – 216,000 masks
- October – 165,000 masks
- November – 197,000 masks
Each unit sells for $7.75.
The company sells their masks to merchandisers. All sales are on account. The company’s collection pattern is:
- 70 % of sales are collected in the month of sale
- 30 % are collected in the month following the sale

The company desires to have finished goods inventory (masks) on hand at the end of each month equal to 20% of the following month’s budgeted sales in units. On June 30, 2020, the company had 44,400 masks on hand.
.2 yards of fabric are required for each mask produced. The company desires to have materials on hand at the end of each month equal to 30% of the following month’s production needs. On June 30, 2020, the company had 14,136 yards of fabric on hand.
The fabric used in production costs $14.00 per yard. The company’s payment pattern is:
- 60% of the month’s purchases are paid for in the month of purchase
- 30% are paid for in the month following the purchase
Each mask requires 3 minutes (0.2 hours) of labor time to make and the hourly employees are paid $18/hour. Wages are paid in the month incurred.

Variable manufacturing overhead is $0.75 per mask

Please show in excel your calculations

Expert Solution

Raw Materials Purchases Budget
	2020
	July	August	September	TOTAL	October
Units Produced	235600	275200	205800	716600	171400
Yards of RM Required Per Unit of FG	0.2	0.2	0.2	0.2	0.2
Total Yards Used in Production	47,120	55,040	41,160	143,320	34,280
Plus: Desired Yards in Ending Inventory	16,512	12,348	10,284	10,284
Total Yards Required	63,632	67,388	51,444	153,604
Less: Yards in Beginning Inventory	14,136	16,512	12,348	14,136
RAW MATERIALS PURCHASES (YARDS)	49,496	50,876	39,096	139,468
Cost per Yard	14	14	14	14
RAW MATERIALS PURCHASES (COST)	692,944	712,264	547,344	1,952,552

Working
Production Budget	July	August	September	TOTAL	October	November
Budgeted Sales	222000	290000	216000	728000	165000	197000
Add: Desired Ending Inventory	58000	43200	33000	33000	39400
Total Required	280000	333200	249000	761000	204400
Less: Beginning Inventory	44400	58000	43200	44400	33000
Units to be produced	235600	275200	205800	716600	171400

Calculations

ekkarill92 answered 1 year ago

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