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Tangshang Industries production budget from the 2nd quarter of 2018, projected the following amounts of units to be produced:
April 1,000 units
May 1,200 units
June 1,250 units
Each unit requires 2 parts of component A and 3 parts of component B. Component A cost is $1.25 per unit and component B cost is $.80 per unit.
A. Calculate the Direct Material budgeted cost for May 2018
B. Calculate the Direct Material budgeted cost for the quarter April - June 2018
C. The raw materials inventory policy is 0 ending inventory, 0 beginning inventory. How much inventory of component A is required in April 2018?
The capitalized cost of this equipment that is part of the CAPEX would be computed as:
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