Julie Finn is preparing the materials purchases budget for the second quarter.The production manager has provided the following production budget information: January - 60,000 units, February – 55,000 units, March – 50,000 units. Each unit requires 5 gallons of direct materials, and Julie wants to maintain an ending inventory equal to 15% of the next month’s production needs. How many gallons will Julie budget to purchase in February?
A) 271,250
B) 275,000
C) 282,500
D) 312,500

Question

Quizplus · Accepted Answer

55,000 + [50,000 x 15% - 55,000 x 15%] = 54,250 x 5 = 271,250

Julie Finn Is Preparing the Materials Purchases Budget for the Second