Andersen Company required production for June is 66,000 units. To make one unit of finished product, three pounds of direct material Z are required. Actual beginning and desired ending inventories of direct material Z are 150,000 and 165,000 pounds, respectively. How many pounds of direct material Z must be purchased?
A) 189,000.
B) 198,000.
C) 204,000.
D) 213,000.

Question

Quizplus · Accepted Answer

To calculate the pounds of direct material Z to be purchased, first calculate the total material required for production: 66,000 units * 3 pounds/unit = 198,000 pounds. Then, adjust for inventory changes: 198,000 pounds + (165,000 pounds desired ending inventory - 150,000 pounds beginning inventory) = 213,000 pounds.

Andersen Company Required Production for June Is 66,000 Units