Answer:
$4,280
Explanation:
Calculation to determine what The budgeted purchases of pounds of direct material B during May should be:
For the month of APRIL
Units required to be produced in April = Units required to be sold April - Opening Inventory 40% of Sales of May
Units required to be produced in April= 380 - 152 + (420 * 40%)
Units required to be produced in April=380-152+168
Units required to be produced in April= 336 units
Total units of raw material to be purchased =336 *5 pounds
Total units of raw material to be purchased= 1,680 pounds
Now for the month of MAY
First step is to calculate May Units required to be produced in May using this formula
Using this formula
Units required to be produced in May = Sales for the month - Opening Inventory + % of Sales of June
Let plug in the formula
Units required to be produced in May= 420 -(420 * 40%) + (440 * 40%)
Units required to be produced in May= 420 -168+176
Units required to be produced in May= 428
Second step is to calculate the Total units of raw material to be purchased
Total units of raw material to be purchased = 428*5 pounds
Total units of raw material to be purchased = 2,140 pounds
Now let determine the budgeted purchases of pounds of direct material B
Purchase cost for the month = $2,140 * $2.00 per pound.
Purchase cost for the month= $4,280
Therefore The budgeted purchases of pounds of direct material B during May should be:$4,280
