Milligan Manufacturing Company produces and sells garden tools. The company has developed the following production...
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Accounting
Milligan Manufacturing Company produces and sells garden tools. The company has developed the following production plan for its new electric trimmer.
January
February
March
April
Budgeted production (in units)
4,000
4,000
5,000
6,000
Each unit requires three feet of metal tubing. The company wishes to have ending inventory equal to 110% of its next months production needs, plus an additional 100 feet. Januarys beginning inventory meets this requirement. Milligans standard cost per foot is $2.80.
Required
Prepare the 1st quarter direct materials purchases budget for metal tubing.
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