Bonkowski Corporation makes one product and has provided the following information to help prepare the master budget for the next four months of operations: Credit sales are collected:
30% in the month of the sale
70% in the following month
Raw materials purchases are paid:
30% in the month of purchase
70% in the following month
The ending finished goods inventory should equal 30% of the following month's sales. The ending raw materials inventory should equal 10% of the following month's raw materials production needs.
The estimated unit product cost is closest to:

Question

Bonkowski Corporation makes one product and has provided the following information to help prepare the master budget for the next four months of operations:   Credit sales are collected:
30% in the month of the sale
70% in the following month
Raw materials purchases are paid:
30% in the month of purchase
70% in the following month
The ending finished goods inventory should equal 30% of the following month's sales. The ending raw materials inventory should equal 10% of the following month's raw materials production needs.
The estimated unit product cost is closest to:

Quizplus · Accepted Answer

The estimated unit product cost is computed as follows:
 11eacbfc_c5f8_90a6_8ffe_9153efb5f247_TB7552_00

Bonkowski Corporation Makes One Product and Has Provided the Following