Griffith Company has budgeted purchases of direct materials for December of $105,000. Expected beginning materials inventory on December 1 and ending materials inventory on December 31 are $120,000 and $129,000, respectively. If direct materials requisitioned purchases average 75% of direct materials purchases, what are budgeted direct materials purchases for December?

Question

Griffith Company has budgeted purchases of direct materials for December of $105,000. Expected beginning materials inventory on December 1 and ending materials inventory on December 31 are $120,000 and $129,000, respectively. If direct materials requisitioned purchases average 75% of direct 	materials purchases, what are budgeted direct materials purchases for December?

Quizplus · Accepted Answer

The budgeted direct materials purchases for December can be calculated using the formula: Budgeted Purchases = (Ending Inventory + Materials Used) - Beginning Inventory. Given that materials used is 75% of purchases, we can set up the equation: 105,000 = (129,000 + (0.75 * Purchases)) - 120,000. Solving for Purchases gives us $128,000.

Griffith Company Has Budgeted Purchases of Direct Materials for December