The budget components for Birk Company for the quarter ended June 30 appear below. Birk sells trash cans for $12 each. Budgeted production for the next three months is: $$\begin{array} { l l }
\text { April } & 26,000 \text { units } \
\text { May } & 46,000 \text { units } \
\text { June } & 29,000 \text { units }
\end{array}$$ Birk desires to have trash cans on hand at the end of each month equal to 20 percent of the following month's budgeted sales in units. On March 31 Birk had 4000 completed units on hand. Five pounds of plastic are required for each trash can. At the end of each month Birk desires to have 10 percent of the following month's production material needs on hand. At March 31 Birk had 13000 pounds of plastic on hand. The materials used in production costs $0.60 per pound. Each trash can produced requires 0.10 hours of direct labor.
Instructions
Compute the cost of the plastic inventory at the end of May.

Question

The budget components for Birk Company for the quarter ended June 30 appear below. Birk sells trash cans for $12 each. Budgeted production for the next three months is: $$\begin{array} { l l } 
\text { April } & 26,000 \text { units } \
\text { May } & 46,000 \text { units } \
\text { June } & 29,000 \text { units }
\end{array}$$ Birk desires to have trash cans on hand at the end of each month equal to 20 percent of the following month's budgeted sales in units. On March 31 Birk had 4000 completed units on hand. Five pounds of plastic are required for each trash can. At the end of each month Birk desires to have 10 percent of the following month's production material needs on hand. At March 31 Birk had 13000 pounds of plastic on hand. The materials used in production costs $0.60 per pound. Each trash can produced requires 0.10 hours of direct labor.
Instructions
Compute the cost of the plastic inventory at the end of May.

Quizplus · Accepted Answer

The Answer of The budget components for Birk Company for the quarter ended June 30 appear below. Birk sells trash cans for $12 each. Budgeted production for the next three months is: $$\begin{array} { l l } 
\text { April } & 26,000 \text { units } \
\text { May } & 46,000 \text { units } \
\text { June } & 29,000 \text { units }
\end{array}$$ Birk desires to have trash cans on hand at the end of each month equal to 20 percent of the following month's budgeted sales in units. On March 31 Birk had 4000 completed units on hand. Five pounds of plastic are required for each trash can. At the end of each month Birk desires to have 10 percent of the following month's production material needs on hand. At March 31 Birk had 13000 pounds of plastic on hand. The materials used in production costs $0.60 per pound. Each trash can produced requires 0.10 hours of direct labor.
Instructions
Compute the cost of the plastic inventory at the end of May.

The Budget Components for Birk Company for the Quarter Ended