Prepare direct materials budget and production budget

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Reference no: EM131295534

Fuqua Company’s sales budget projects unit sales of part 198Z of 10,000 units in January, 12,400 units in February, and 13,300 units in March. Each unit of part 198Z requires 3 pounds of materials, which cost $5 per pound. Fuqua Company desires its ending raw materials inventory to equal 40% of the next month’s production requirements, and its ending finished goods inventory to equal 20% of the next month’s expected unit sales. These goals were met at December 31, 2016.

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Prepare a production budget for January and February 2017

Prepare a direct materials budget for January 2017.

Reference no: EM131295534

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