Sudler Production is planning to sell 600 boxes of ceramic tile, with production estimated at 580 boxes during May.Each box of tile requires 44 kilograms of clay mix and a quarter hour of direct labour.Clay mix costs $0.50 per kilogram and employees of the company are paid $15.00 per hour.Manufacturing overhead is applied at a rate of 110% of direct labour costs.Sudler has 2,600 kilograms of clay mix in beginning inventory and wants to have 3,000 kilograms in ending inventory.What is the total amount to be budgeted in kilograms for direct materials to be purchased for the month?
A)25,520
B)25,120
C)25,920
D)26,800

Question

Quizplus · Accepted Answer

The total amount to be budgeted in kilograms for direct materials to be purchased can be calculated as follows:

Total production needed = 600 boxes 
Clay mix needed per box = 44 kg 
Total clay mix needed = 600 boxes x 44 kg per box = 26,400 kg

Add the desired ending inventory to get the total clay mix needed: 
Total clay mix needed = 26,400 kg + 3,000 kg = 29,400 kg

Subtract the beginning inventory from the total clay mix needed to get the amount of clay mix to be purchased: 
Clay mix to be purchased = 29,400 kg - 2,600 kg = 26,800 kg

Therefore, the total amount to be budgeted in kilograms for direct materials to be purchased for the month is 26,800 kg. The correct answer is option C.

Sudler Production Is Planning to Sell 600 Boxes of Ceramic