Coca-Cola Enterprises is the largest bottler of Coca-Cola ® in Western Europe. T
ID: 2425507 • Letter: C
Question
Coca-Cola Enterprises is the largest bottler of Coca-Cola® in Western Europe. The company purchases Coke® and Sprite® concentrate from The Coca-Cola Company, dilutes and mixes the concentrate with carbonated water, and then fills the blended beverage into cans or plastic two-liter bottles. Assume that the estimated production for Coke and Sprite two-liter bottles at the Wakefield, UK, bottling plant are as follows for the month of May:
In addition, assume that the concentrate costs $75 per pound for both Coke and Sprite and is used at a rate of 0.15 pound per 100 liters of carbonated water in blending Coke and 0.10 pound per 100 liters of carbonated water in blending Sprite. Assume that two liters of carbonated water are used for each two-liter bottle of finished product. Assume further that two-liter bottles cost $0.08 per bottle and carbonated water costs $0.06 per liter.
Prepare a direct materials purchases budget for May 2016, assuming inventories are ignored, because there are no changes between beginning and ending inventories for concentrate, bottles, and carbonated water. When required, enter unit prices to the nearest cent.
Coca-Cola Enterprises-Wakefield PlantDirect Materials Purchases BudgetFor the Month Ending May 31, 2016 (assumed data)Concentrate2-Liter BottlesCarbonated WaterMaterials required for production:Coke®lbs.btls.ltrs.Sprite®Total materialslbs.btls.ltrs.Direct materials unit pricex $x $x $Total direct materials to be purchased$$$
Coke 153,000 two-liter bottles Sprite 86,500 two-liter bottles Direct Materials Purchases Budget Coca-Cola Enterprises is the largest bottler of Coca-Cola^registered in Western Europe. The company purchases Coke^registered and Sprite^registered concentrate from The Coca-Cola Company, dilutes and mixes the concentrate with carbonated water, and then fills the blended beverage into cans or plastic two-liter bottles. Assume that the estimated production for Coke and Sprite two-liter bottles at the Wakefield, UK, bottling plant are as follows for the month of May: In addition, assume that the concentrate costs $75 per pound for both Coke and Sprite and is used at a rate of 0.15 pound per 100 liters of carbonated water in blending Coke and 0.10 pound per 100 liters of carbonated water in blending Sprite. Assume that two liters of carbonated water are used for each two-liter bottle of finished product. Assume further that two-liter bottles cost $0.08 per bottle and carbonated water costs $0.06 per liter. Prepare a direct materials purchases budget for May 2016, assuming inventories are ignored, because there are no changes between beginning and ending inventories for concentrate, bottles, and carbonated water. When required, enter unit prices to the nearest cent. Coca-Cola Enterprises-Wakefield Plant Direct Materials Purchases Budget For the Month Ending May 31, 2016 (assumed data) Materials required for production: Coke^registered Sprite^registered Total materials Direct materials unit price Total direct materials to be purchasedExplanation / Answer
Direct Materials Purchases Budget:
Concentrate 2-ltr bottles Carbonated Water Materials required for production: Coke 0.0015 x 153000 x 2 = 459 pounds 153000 Bottles 2 x 153000 = 306000 Ltrs. Sprite 0.0010 x 86500 x 2 = 173 pounds 86500 Bottles 2 x 86500 = 173000 Ltrs. Total Materials 632 pounds 239500 Bottles 479000 Ltrs. Direct Materials unit price $ 75 per pound $0.08 per bottle $0.06 per Ltr. Total direct materials to be purchased $47400 $19160 $28740