Addams,Inc.,is preparing its master budget for the second quarter.The following sales and production data have been forecasted:
Finished goods inventory on March 31: 120 units
Raw materials inventory on March 31: 450 pounds
Desired ending inventory each month:
Finished goods: 30% of next month's sales
Raw materials: 25% of next month's production needs
Number of pounds of raw material required per finished unit: 4 lbs.
How many pounds of raw materials should be purchased in April?

Question

Addams,Inc.,is preparing its master budget for the second quarter.The following sales and production data have been forecasted:
  Finished goods inventory on March 31: 120 units
Raw materials inventory on March 31: 450 pounds
Desired ending inventory each month:
Finished goods: 30% of next month's sales
Raw materials: 25% of next month's production needs
Number of pounds of raw material required per finished unit: 4 lbs.
How many pounds of raw materials should be purchased in April?

Quizplus · Accepted Answer

The Answer of Addams,Inc.,is preparing its master budget for the second quarter.The following sales and production data have been forecasted:
  Finished goods inventory on March 31: 120 units
Raw materials inventory on March 31: 450 pounds
Desired ending inventory each month:
Finished goods: 30% of next month's sales
Raw materials: 25% of next month's production needs
Number of pounds of raw material required per finished unit: 4 lbs.
How many pounds of raw materials should be purchased in April?