90.2K

Verified Solution

Link Copied!

I need help finding the Desired units of ending raw materials inventory for the fourth quarter. Please include calculation

Two grams of musk oil are required for each bottle of Mink Caress, a very popular perfume made by a small company in western Siberia. The cost of the musk oil is $1.70 per gram. Budgeted production of Mink Caress is given below by quarters for Year 2 and for the first quarter of Year 3 Year 2 First Second Third Fourth 78,000 108,000 168,000 118,000 Year 3 First 88,000 Budgeted production, in bottles Musk oil has become so popular as a perfume ingredient that it has become necessary to carry large inventories as a precaution against stock-outs. For this reason, the inventory of musk oil at the end of a quarter must be equal to 20% of the following quarter's production needs. Some 31,200 grams of musk oil will be on hand to start the first quarter of Year 2 Required: Prepare a direct materials budget for musk oil, by quarter and in total, for Year 2. (Round "Unit cost of raw materials" answers to 2 decimal places.) Mink Caress Direct Materials Budget Year 2 Quarter First Second Third Fourth Year equired production in units of finished goods Units of raw materials needed per unit of finished goods Units of raw materials needed to meet production Add: Desired units of ending raw materials inventory Total units of raw materials needed 78,000 2 156,000 43,200 199,200 108,000 2 216,000 67,200 283,200 168,000 2 336,000 47,200 383,200 118,000 472,000 2 944,000 2 ..236,000 Units of raw materials to be purchased Unit cost of raw materials Cost of raw materials to purchased

Answer & Explanation Solved by verified expert

See Answer