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Base Manufacturing expects to produce 2400 units in January and 3700 units in February

Accounting

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Base Manufacturing expects to produce 2400 units in January and 3700 units in February. Base budgets $45 per unit for direct materials. The amount of indirect materials needed for production has been determined to be insignificant and will therefore not be considered in the calculation. The balance in the Raw Materials Inventory account (all direct materials) on January 1 is $37,250. Base desires the ending balance in Raw Materials Inventory to be 70% of the next month's direct materials needed for production. Desired ending balance for February is $51,800. What is the cost of budgeted purchases of direct materials needed for January?

Select one:

 

A.

$146,350

 

B.

$187,300

 

C.

$108,000

 

D.

$224,550