Reference no: EM132534053

Budgeting production and direct material purchases: manufacture Dante ltd prepare annual budgets. The following beginning and ending inventory level (in units) are planned foe next year. Four kilograms of direct material are required to produce each unit of finished product.

                                    1 January                   31 December

Direct material                     80 000                     100 000

Work in process                     20 000                    20 000

Finished goods                    160 000                        100 000

Required.

Question 1) If Dante plane to sell 480 000 unit during the year, calculate the number of units the firm would have manufacture.

Question 2) If 600 000 finished units are to be manufactured by Dante during the year, determine the amount of direct material that needs to be purchased.