Highland Corporation has budgeted production of 94,000 units for the upcoming three-month period. Each unit requires 4.5 kilograms of a particular raw material. As the quarter is about to begin, Highland holds an inventory of 84,600 kilograms of this material and has targeted an ending inventory of 90,000 kilograms. What amount of this raw material will need to be purchased during the upcoming quarter?
A) 99,400
B) 423,000
C) 417,600
D) 428,400

Question

Quizplus · Accepted Answer

To calculate the amount of raw material to be purchased:  1. Calculate the total raw material required for production: 94,000 units * 4.5 kg/unit = 423,000 kg.  2. Add the desired ending inventory: 423,000 kg + 90,000 kg = 513,000 kg.  3. Subtract the beginning inventory: 513,000 kg - 84,600 kg = 428,400 kg.  Therefore, 428,400 kg of raw material needs to be purchased.

Highland Corporation Has Budgeted Production of 94,000 Units for the Upcoming