Kittle Corporation has two products; AB and CD. The beginning and ending balances of finished...
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Accounting
Kittle Corporation has two products; AB and CD. The beginning and ending balances of finished goods and raw materials inventories are presented below.
Products
Raw Materials
AB
CD
X
Y
Beginning Inventory
12,000 units
6,500 units
120 kg
24,000 units
Target Ending Inventory
8,000 units
3,500 units
320 kg
18,000 units
Expected Sales
35,000 units
15,000 units
Each unit of AB requires the use of 15gr of X and 2 units of Y whereas each unit of CD requires the use of 20gr of X and 4 units of Y.
Throughout this year, company paid $12 for 1 kg of X and $14 for a unit of Y. However, it is projected that 1 kg of X will be sold in the market from $14/kg and each unit of Y from $16 next year.
Prepare the production budget. (10 pts)
Prepare the DM Purchase Budget. (15 pts)
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