Can someone please help me fill these boxes out. Thank you Two grams of musk oil
ID: 2491703 • Letter: C
Question
Can someone please help me fill these boxes out. Thank you
Two 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 $1.80 per gram. Budgeted production of Mink Caress is given below by quarters for Year 2 and for the first quarter of Year 3: 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 32,000 grams of musk oil will be on hand to start the first quarter of Year 2. Required: Prepare a direct materials budget for musk oil, by quarter and in total, for Year 2.Explanation / Answer
Mink Caress Direct Materials Budget – Year 2 First Second Third Fourth Year Required produc±on in units of Fnished goods 80000 110000 170000 120000 480000 Units of raw materials needed per unit of fnished goods 3.6 3.6 3.6 3.6 3.6 Units of raw materials needed tomeet produc±on 288000 396000 612000 432000 1728000 Less Endning inventory-batteries 79200 122400 86400 64800 352800 Total units of raw materials needed 208800 273600 525600 367200 1375200 Less: units of beginning raw materials inventory 32000 79200 122400 86400 320000 Units of raw materials to be purchased 1 176800 194400 403200 280800 1055200 Unit cost of raw materials 1.8 1.8 1.8 1.8 1.8 Cost of raw materials to be purchased 318240 349920 725760 505440 1899360