Alfa Company has 2,000 pounds of raw materials in its December 31, 2018, ending inventory

Accounting Sep 07, 2020

Alfa Company has 2,000 pounds of raw materials in its December 31, 2018, ending inventory. Required production for January and February of 2019 are 4,000 and 5,000 units, respectively. Two pounds of raw materials are needed for each unit, and the estimated cost per pound is $6. Management desires an ending inventory equal to 25% of next month's materials requirements.

Prepare the direct materials budget for January.

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