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What is the budgeted cost of sugar purchases

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Question - Amargo Company manufactures chocolates. Each chocolate box sells for $15. Amargo projects sales for May 2021 will be 650 units, with sales increasing by 10 units per month for June, July, and August 2021. On May 1, 2021, Amargo has 70 units on hand and desires to maintain an ending inventory of 20% of the next month's sales.

Amargo budgets 0.5 pounds of sugar (direct material) per box at a cost of $0.40 per pound. The balance in the Raw Materials Inventory-Sugar account on May 1, 2021 is 15 pounds and Amargo desires the ending balance in Raw Materials Inventory-Sugar to be 25% of the next month's sugar needed for production.

Find the budgeted units to be produced for June 2021.

What is the budgeted cost of sugar purchases for June 2021? Round to the nearest cents.

Reference no: EM132964621

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