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vovangra [49]
3 years ago
5

Robo Inc.requires $70,000 of direct material for production and top management desires $3,000 in ending raw materials inventory.

The company has $2,000 in beginning raw materials inventory. What would Robo's budgeted purchases of direct materials be
Business
1 answer:
Alexxx [7]3 years ago
8 0

Answer:

Budgeted purchases = $71000

Explanation:

Below is the given values:

Direct material for the production = $70000

Ending raw material inventory = $3000

Beginning raw material = $2000

Budgeted purchases = Direct material for the production + Ending raw material - Beginning raw material

Budgeted purchases = 70000 + 3000 - 2000

Budgeted purchases = $71000

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3 years ago
A produce distributor uses 783 packing crates a month, which it purchases at a cost of $11 each. The manager has assigned an ann
jeyben [28]

Answer:

Annual Savings will be ;

Ordering Cost = $2,993.88

Holding Cost = $661.78

Explanation:

First Calculate the Economic Order Quantity (EOQ)

EOQ = √ 2 × Annual Demand × Ordering Cost per Order / Holding Cost per unit

        = √ ((2 × 783× 12 × $31) / ($11 × 32%))

        = 407

Note : Currently the firm orders at 783 crates per month

Savings in Ordering Cost will be :

Savings = Ordering Cost at Current Quantity - Ordering Cost at EOQ

             = (Total Demand / Current Quantity × Ordering Costs) - (Total Demand / Current Quantity × Ordering Costs)

             = (9396/783 × $31) - (9396/407 × $31)

             = $2,993.88

Savings in Holding Cost will be :

Savings = (Current Quantity - Economic Order Quantity) / 2 × Holding Cost per unit

             = (783 - 407) / 2 × ($11 × 32%)

             = $661.78

4 0
3 years ago
Kristi sells purses. her cost is $35 per purse. on a certain day, she sells 12 purses, and her producer surplus for that day amo
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8 0
4 years ago
Norton Manufacturing expects to produce 2,900 units in January and 3,600 units in February. Norton budgets $20 per unit for dire
storchak [24]

Answer:

Purchases= $26,550

Explanation:

Giving the following information:

Production:

January= 2,900 units

February= 3,600 units

Norton budgets $20 per unit for direct materials.

Beginning inventory raw materials= $38,650.

Desired ending inventory direct materials= 10% of the next month's direct materials needed for production.

To calculate the purchases of direct material, we need to use the following formula:

Purchases= production + desired ending inventory - beginning inventory

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Purchases= $26,550

6 0
3 years ago
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