Dewitt Industries has adopted the following production budget for the first 4 months of 2012.

Dewitt Industries has adopted the following production budget for the first 4 months of 2012.

 

Month /  Units

January    11,200

February     7,900

March         5,400

April            3,600

 

Each unit requires 5 pounds of raw materials costing $2 per pound. On December 31, 2011, the ending raw materials inventory was 17,360 pounds. Management wants to have a raw materials inventory at the end of the month equal to 31% of next month’s production requirements. Complete a direct materials purchases budget by month for the first quarter. (Enter all amounts as positive amounts and subtract where necessary.)

 

                                                    January            February            March

Units to be produced

Direct Materials per Unit

Total Pounds Needed for Production

Add: Desired Ending Direct Material (pounds)

Total Material Required

Less: Beginning Direct Material (pounds)

Direct Materials Purchases

Cost per Pounds

TOTAL COST OF DIRECT MATERIAL PURCHASES