Question

Four grams of musk oil are required for each bottle of Mink Caress, a very popular perfume made by a small company in western Siberia. The cost of the musk oil is $2.10 per gram. Budgeted production of Mink Caress is given below by quarters for Year 2 and for the first quarter of Year 3:

	Year 2					Year 3
	First	Second	Third	Fourth		First
Budgeted production, in bottles	98,000	128,000	188,000	138,000		108,000

Musk oil has become so popular as a perfume ingredient that it has become necessary to carry large inventories as a precaution against stock-outs. For this reason, the inventory of musk oil at the end of a quarter must be equal to 20% of the following quarter’s production needs. Some 78,400 grams of musk oil will be on hand to start the first quarter of Year 2.

I keep getting my answers wrong... Please explain and bold all answers. Thanks

Required:

Prepare a direct materials budget for musk oil, by quarter and in total, for Year 2. (Round "Unit cost of raw materials" answers to 2 decimal places.)

Answer is complete but not entirely correct.

Mink Caress Direct Materials Budget - Year 2 Quarter First Second Third Fourth Year Required production in units of finished goodsselected answer correct 98,000selected answer correct 128,000selected answer correct 188,000selected answer correct 138,000selected answer correct 552,000selected answer correct Units of raw materials needed per unit of finished goods 2selected answer incorrect 2selected answer incorrect 2selected answer incorrect 2selected answer incorrect 2selected answer incorrect Units of raw materials needed to meet production 196,000 256,000 376,000 276,000 1,104,000 Add: Desired units of ending raw materials inventoryselected answer correct 51,200selected answer incorrect 75,200selected answer incorrect 55,200selected answer incorrect 220,800selected answer incorrect 43,200selected answer incorrect Total units of raw materials needed 247,200 331,200 431,200 496,800 1,147,200 Less: Desired units of ending raw materials inventoryselected answer incorrect 78,400selected answer correct 51,200selected answer incorrect 75,200selected answer incorrect 55,200selected answer incorrect 220,800selected answer incorrect Units of raw materials to be purchased 168,800 280,000 356,000 441,600 926,400 Unit cost of raw materials $2.10selected answer correct $2.10selected answer correct $2.10selected answer correct $2.10selected answer correct $2.10selected answer correct Cost of raw materials to purchased $354,480 $588,000 $747,600 $927,360 $1,945,440

Answer 1

					First	second	third	fourth	QTR
Required production units of finished goods					98,000	128,000	188,000	138,000	552,000
gramsof raw materials needed per unit of finished					4	4	4	4	4
gramsof raw materials needed to meet production					392000	512000	752000	552000	2208000
Add:desired ending inventory					102400	150400	110400	86400	86400
total units of raw materials needed					494400	662400	862400	638400	2294400
less:Desired beginning inventory					78,400	102400	150400	110400	78,400
materials to be purchased					416,000	560000	712000	528000	2,216,000
cost of materials per gram					2.1	2.1	2.1	2.1	2.1
total cost of materials					873600	1176000	1495200	1108800	4653600
		for qtr four ending inventory = 108000*4*20%
					86400
			for qtr 1 =		512000*20%=		102400
			for qtr 2 =		752000*20%=		150400
			for Qtr 3=		552000*20%		110400