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Direct Materials Purchases Budget Romano’s Frozen Pizza Inc
Direct Materials Purchases Budget
Romano’s Frozen Pizza Inc. has determined from its production budget the following estimated production volumes for 12'' and 16'' frozen pizzas for September:
| Units | ||||
| 12" Pizza | 16" Pizza | |||
| Budgeted production volume | 14,900 | 24,000 | ||
There are three direct materials used in producing the two types of pizza. The quantities of direct materials expected to be used for each pizza are as follows:
| 12" Pizza | 16" Pizza | ||||
| Direct materials: | |||||
| Dough | 0.90 | lb. per unit | 1.50 | lbs. per unit | |
| Tomato | 0.60 | 1.00 | |||
| Cheese | 0.80 | 1.30 | |||
In addition, Romano's has determined the following information about each material:
| Dough | Tomato | Cheese | ||||
| Estimated inventory, September 1 | 600 | lbs. | 220 | lbs. | 270 | lbs. |
| Desired inventory, September 30 | 630 | lbs. | 210 | lbs. | 300 | lbs. |
| Price per pound | $1.00 | $2.80 | $3.30 | |||
Prepare September's direct materials purchases budget for Romano’s Frozen Pizza Inc. For those boxes in which you must enter subtracted or negative numbers use a minus sign.
| Romano’s Frozen Pizza Inc. | ||||
| Direct Materials Purchases Budget | ||||
| For the Month Ending September 30 | ||||
| Dough | Tomato | Cheese | Total | |
| Units required for production: | ||||
| 12" pizza | ||||
| 16" pizza | ||||
| Total units available | ||||
| Total units to be purchased | ||||
| Unit Price | ||||
| Total direct materials to be purchased | ||||
Expert Solution
Answer
- Requirements asked
|
Direct Materials Purchases Budget |
|||||
|
For the Month Ending September 30 |
|||||
|
Dough |
Tomato |
Cheese |
Total |
||
|
Units required for production: |
|||||
|
A |
12" pizza |
13,410 |
8,940 |
11,920 |
34,270 |
|
B |
16" pizza |
36,000 |
24,000 |
31,200 |
91,200 |
|
C |
Desired inventory, Nov 30 |
630 |
210 |
300 |
|
|
D = A+B+C |
Total units available |
50,040 |
33,150 |
43,420 |
126,610 |
|
E |
Estimated inventory, Nov 1 |
(600) |
(220) |
(270) |
|
|
F= D - E |
Total units to be purchased |
49,440 |
32,930 |
43,150 |
125,520 |
|
G |
Unit Price |
$ 1.00 |
$ 2.80 |
$ 3.30 |
|
|
H = F x G |
Total direct materials to be purchased |
$ 49,440.00 |
$ 92,204.00 |
$ 142,395.00 |
$ 284,039.00 |
- Note
|
Dough |
Tomato |
Cheese |
|
|
Units required for production: |
|||
|
12" pizza |
=14900*0.9 |
=14900*0.6 |
=14900*0.8 |
|
16" pizza |
=24000*1.5 |
=24000*1 |
=24000*1.3 |
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