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Ainat [17]
3 years ago
5

Direct material budget. Dawson Co. produces wine. The company expects to produce 2,535,000 two-liter bottles of Chablis in 2018.

Dawson purchases empty glass bottles from an outside vendor. Its target ending inventory of such bottles is 77,000; its beginning inventory is 54,000. For simplicity, ignore breakage. Compute the number of bottles to be purchased in 2018.
Business
1 answer:
mars1129 [50]3 years ago
8 0

Answer:

2,558,000 bottles

Explanation:

The formula for computation of the purchase is:

Purchase in units = Usage + Desired ending material inventory units − Beginning inventory units.

In format that will be:

Beginning inventory   54,000

Plus: Purchases.........2,558,000

Less:ending inventory <u>77,000</u>

Required For Use......<u>2,535,000</u>

Hence the number of bottles to be purchased in 2018 is 2,558,000

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