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In: Accounting
New Ventures intends to start business on January 1. Production plans for the first four months...
New Ventures intends to start business on January 1. Production plans for the first four months of operations are as follows: January 20,000 units February 46,000 units March 84,000 units April 84,000 units Each unit requires 3 kilograms of material. The firm would like to end each month with enough raw material inventory on hand to cover 25% of the following month’s production needs. The material costs $6 per kilogram. Management anticipates being able to pay for 40% of the purchases in the month of purchase. The firm will receive a 10% discount for these early payments. Management anticipates having to defer payment to the next month on 60% of the firm’s purchases. No discount will be taken on these late payments. The business starts with no inventories on January 1.
Determine the budgeted payments for purchases of materials for each of the first three months of operations. (Round answers to the nearest whole dollar, e.g. 5,275.)
January February March
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ekkarill92 answered 1 year agoRelated Solutions
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Direct material purchases and budgeted
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Campbell Manufacturing intends to start business on January 1.
Production plans for the first four months of operations are as
follows:
January
8,000
units
February
20,000
units
March
28,000
units
April
28,000
units
Each unit requires two pounds of material. The firm would like
to end each month with enough raw material to cover 25 percent of
the following month’s production needs. Raw material costs $7 per
pound. Management pays for 40 percent of...
Direct material purchases and budgeted payments Campbell Manufacturing intends to start business on January 1. Production...
Direct material purchases and budgeted
payments
Campbell Manufacturing intends to start business on January 1.
Production plans for the first four months of operations are as
follows:
January
8,000
units
February
20,000
units
March
28,000
units
April
28,000
units
Each unit requires two pounds of material. The firm would like
to end each month with enough raw material to cover 25 percent of
the following month’s production needs. Raw material costs $7 per
pound. Management pays for 40 percent of...
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