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Timberland Inc. produces 100 types of ornaments for Christmas in glass. The company distributes their ornaments around five multinational companies in the world. Each ornament requires 0.3 board feet of glass and 1.25 hours of direct labor. Glass costs $1.50 per board foot. Timberland pays it employees $15.00 per hour. Timberland desires to have 30% of the materials needed for production during the next month on hand at the end of each month, and 15% of the number of ornaments to be sold the next month on hand at the end of each month. Scheduled productions in units for 2017 are:
April 5,100
May 6,300
June 7,200
Required:
Prepare a materials purchases budget for May in good form.
Calculate budgeted raw materials inventory on the balance sheet at May 31, 2017.
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