Prester Corporation has budgeted production for next year as follows:
Two pounds of material A are required for each unit produced. The company has a policy of maintaining a stock of material A on hand at the end of each quarter equal to 25% of the next quarter's production needs for materialA. A total of 30,000 pounds of material A are on hand to start the year. Budgeted purchases of material A for the second quarter would be:
A)145,000 pounds
B)140,000 pounds
C)135,000 pounds

Question

Prester Corporation has budgeted production for next year as follows:  
Two pounds of material A are required for each unit produced. The company has a policy of maintaining a stock of material A on hand at the end of each quarter equal to 25% of the next quarter's production needs for materialA. A total of 30,000 pounds of material A are on hand to start the year. Budgeted purchases of material A for the second quarter would be:
A)145,000 pounds 
B)140,000 pounds 
C)135,000 pounds

Quizplus · Accepted Answer

The Answer of Prester Corporation has budgeted production for next year as follows:  
Two pounds of material A are required for each unit produced. The company has a policy of maintaining a stock of material A on hand at the end of each quarter equal to 25% of the next quarter's production needs for materialA. A total of 30,000 pounds of material A are on hand to start the year. Budgeted purchases of material A for the second quarter would be:
A)145,000 pounds 
B)140,000 pounds 
C)135,000 pounds

Prester Corporation Has Budgeted Production for Next Year as Follows