Reference: 20_04
Kyoto, Inc. predicts the following sales in units for the coming four months:
$\begin{array}{llr}
&\text { April}&\text { May}&\text { June}&\text { July }\
\text { Sales in units } &240&280&300&240\
\end{array}$
Although each month's ending inventory of finished units should be 60% of the next month's sales, the March 31 finished goods inventory is only 100 units. A finished unit requires five pounds of raw material B. The March 31 raw materials inventory has 200 pounds of B. Each month's ending inventory of raw materials should be 30% of the following month's production needs.
-The budgeted purchases of pounds of raw material B during May should be:

Question

Reference: 20_04
Kyoto, Inc. predicts the following sales in units for the coming four months:
 $\begin{array}{llr}
&\text { April}&\text { May}&\text { June}&\text { July }\
\text { Sales in units } &240&280&300&240\
\end{array}$
 Although each month's ending inventory of finished units should be 60% of the next month's sales, the March 31 finished goods inventory is only 100 units. A finished unit requires five pounds of raw material B. The March 31 raw materials inventory has 200 pounds of B. Each month's ending inventory of raw materials should be 30% of the following month's production needs.
-The budgeted purchases of pounds of raw material B during May should be:

Quizplus · Accepted Answer

The correct answer is A.The budgeted purchases of pounds of raw material B during May should be 1,418 pounds. This is calculated as follows:May production needs = 280 units x 5 pounds per unit = 1,400 poundsMay ending inventory = 30% of June production needs = 30% x 300 units x 5 pounds per unit = 450 poundsBudgeted purchases = May production needs + May ending inventory - March 31 raw materials inventory = 1,400 pounds + 450 pounds - 200 pounds = 1,418 pounds

Reference: 20_04 Kyoto, Inc April May June July Sales in units 240280300240\begin{array}{llr}&\text { April}&\text { May}&\text { June}&\text { July }\\\text { Sales in units } &240&280&300&240\\\end{array} Sales in units ​ April240​ May280​ June300​ July 240​

Reference: 20_04
Kyoto, Inc $\begin{array}{llr}&\text { April}&\text { May}&\text { June}&\text { July }\\\text { Sales in units } &240&280&300&240\\\end{array}$