Exercise 23-8 Fuqua Company’s sales budget projects unit sales of part 198Z of 10,900 units in...

Exercise 23-8
Fuqua Company’s sales budget projects unit sales of part 198Z of 10,900 units in January, 12,200 units in February, and 14,000 units in March. Each unit of part 198Z requires 3 pounds of materials, which cost $4 per pound. Fuqua Company desires its ending raw materials inventory to equal 40% of the next month’s production requirements, and its ending finished goods inventory to equal 20% of the next month’s expected unit sales. These goals were met at December 31, 2016.

a) Prepare a production budget for January and February 2017.

b) Prepare a direct materials budget for January 2017.

Expert Solution

ekkarill92 answered 2 years ago

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