How many pounds of material does manzoni plan

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Reference no: EM13496421

The Manzoni Corporation manufactures and sells a single product.  They are in the process of preparing next quarter's budget and have provided the following data.

 

 


Finished goods inventory, July 1

2,000 units

 

Desired finished goods inventory, July 31

2,500 units

 

Desired finished goods inventory, August 31

2,400 units

 

Projected sales, July

6,000 units

 

Projected sales, August

7,500 units

 

Raw material required per unit

5 pounds

 

Estimated raw material cost

$9 per pound

 

Direct labor required per unit

2 hours

 

Estimated direct labor rate

$16 per hour

 

Factory overhead rate (based on direct labor)

$12 per hour

 

Company policy is to have enough material on hand at the end of each month to meet 30% of the following month's production needs.

a.      How many pounds of material does Manzoni plan to purchase in July?

b.      What is the budgeted August 31 finished goods inventory balance (in dollars)?

 

Reference no: EM13496421

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