Morganton Company makes one product and it provided the following information to help prepare the master budget:

a. The budgeted selling price per unit is $60. Budgeted unit sales for June, July, August, and September are 9,200, 23,000, 25,000, and 26,000 units, respectively. All sales are on credit.
b. Thirty percent of credit sales are collected in the month of the sale and 70% in the following month
c. The ending finished goods inventory equals 20% of the following month's unit sales.
d. The ending raw materials inventory equals 10% of the following month's raw materials production needs. Each unit of finished goods requires 4 pounds of raw materials. The raw materials cost $2.50 per pound.
e. Thirty percent of raw materials purchases are paid for in the month of purchase and 70% in the following month.
f. The direct labor wage rate is $13 per hour. Each unit of finished goods requires two direct labor-hours
g. The variable selling and administrative expense per unit sold is $1.80. The fixed selling and administrative expense per month is $62,000.
h. In July what are the total estimated cash disbursements for raw materials purchases? Assume the cost of raw material purchases in June is $140,352; and 106,000 pounds of raw materials are needed to meet production in August.

Respuesta :

Answer:

Morganton Company

The total estimated cash disbursements for raw materials are:

$174,776.40

Explanation:

a) Data and Calculations:

Budgeted selling price per unit = $60

                                            June      July      August     September

Budgeted unit sales:        9,200   23,000    25,000      26,000

Ending finished goods     4,600     5,000      5,200

Units of goods sold       23,000   25,000    26,000

Units available for sale  27,600   30,000     31,200

Beginning finished goods              4,600      5,000        5,200

Units produced                            25,400     26,200

     

Raw materials required              101,600    106,000

Ending raw materials inventory  10,600

Raw materials available             112,200

Beginning raw materials              10,160

Raw material purchases           102,040

Cost raw materials purchases $255,100 (102,040 * $2.50)

30% of purchases paid for        $76,530 ($255,100 * 30%)

70% of June purchases              98,246.4 ($140,352 * 70%)

Cash disbursement of materials $174,776.40