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nalin [4]
2 years ago
12

Direct Materials Purchases Budget Pasadena Candle Inc. budgeted production of 785,000 candles for January. Wax is required to pr

oduce a candle. Assume 10 ounces of wax is required for each candle. The estimated January 1 wax inventory is 16,000 pounds. The desired January 31 wax inventory is 12,500 pounds. If candle wax costs $1.24 per pound, determine the direct materials purchases budget for January. (One pound
Business
1 answer:
icang [17]2 years ago
8 0

Answer:

$604,035

Explanation:

The computation of the direct materials purchases budget is shown below:-

Total Wax Required                                490,625 Pounds

(785,000 × 10 ÷ 16)

Add: Ending Inventory                              125,00 Pounds

Total Units Available                              503125 Pounds

Less: Beginning Inventory                         16,000 Pounds

Total Pounds to be Purchased                 487,125 Pounds

Unit Price                                              $1.24 per Pounds

Total Direct Materials Purchased              $604,035

(487,125 × $1.24)

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