Purple Co.'s production budget for Product X for the year ended December 31 is as...
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Purple Co.'s production budget for Product X for the year ended December 31 is as follows:
Product X
Sales (in units)
640,000
Plus desired ending inventory
85,000
Total
725,000
Less estimated beginning inventory, January 1
90,000
Total production
635,000
In Purple's production operations, Materials A, B, and C are required to make Product X. The quantities of direct materials expected to be used for each unit of product are as follows:
Material A
0.50 lb. per unit
Material B
1.00 lb. per unit
Material C
1.20 lb. per unit
The prices of direct materials are as follows:
Material A
$0.60 per lb.
Material B
$1.70 per lb.
Material C
$1.00 per lb.
Prepare a direct materials purchases budget for Product X, assuming that there are no beginning or ending inventories for direct materials (all units purchased are used in production).
Direct Materials
A
B
C
Total
Units required for production of Product X
lb.
lb.
lb.
Unit price
$
$
$
Total direct materials purchases
$
$
$
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