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Crane Company is planning to sell 900 boxes of ceramic tile, with production estimated at 770 boxes during May. Each box of tile requires 44 pounds of clay mix and a 0.50 hour of direct labor. Clay mix costs $0.40 per pound and employees of the company are paid $14 per hour. Manufacturing overhead is applied at a rate of 110% of direct labor costs. Crane has 4300 pounds of clay mix in beginning inventory and wants to have 4900 pounds in ending inventory.
Problem 1: What is the total amount to be budgeted in pounds for direct materials to be purchased for the month?
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