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Purchases Budget Month January Production X Ibs. Production needs in lbs. 10 X DEI no...

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Accounting

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Purchases Budget Month January Production X Ibs. Production needs in lbs. 10 X DEI no *** December: January March 5 5 10 16 The V. Rovere Manufacturing Co, has determined its estimated production for the first four months of the year as follows: Desired Ending Inventory 6.787 units February 7.742 units 6,545 units February April 6,000 units March: The ending inventory is expected to be 60% of the following month's production requirements in pounds. A finished product requires five pounds of direct materials. The cost per pound is $10. Required: 1. Compute the number of pounds of material needed for production for January, February and March 2. Prepare a materials purchases budget in pounds for January, February, and March and for the first quarter. March 1st Qtr. January February Format Add: Total Needs Less: Purchases 3. Rovere Manufacturing has estimated cash available for purchases during the months of January, February and March of $35,000 per month. What recommendation(s) would you make to manage- ment given this cash flow situation

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