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Croy Inc. has the following projected sales for the next five months: ...

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Accounting

Croy Inc. has the following projected sales for the next five months:

Month Sales in Units
April 3,470
May 3,865
June 4,530
July 4,100
August 3,920

Croys finished goods inventory policy is to have 50 percent of the next months sales on hand at the end of each month. Direct materials costs $3.20 per pound, and each unit requires 2 pounds. Direct materials inventory policy is to have 50 percent of the next months production needs on hand at the end of each month. Direct materials on hand at March 31 totaled 3,668 pounds.

Required:

1. Determine budgeted production for April, May, and June.

2. Determine budgeted cost of materials purchased for April and May.

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