Crosser Company budgets on a quarterly basis. The following beginning and ending inventory levels (in units) are planned for the first and second quarters of 2012:
Jan, March, 2012 April, June, 2012
Raw materials 40,000 50,000
Work in process 12,000 15,000
Finished goods 80,000 45,000
Two units of raw material are needed to produce each unit of finished product.
Required:
If Crosser Company were to manufacture 400,000 finished units (in total) during the first two quarters of 2012, how many units of raw material would it need to purchase?
Prepare the purchases budget for the first six months of 2012. Enter all amounts as positive numbers.
Dec. 31, 2011 and June 30, 2012
Required production in units:
Raw material needed per unit:
Units of raw material needed:
Add: Desired ending inventory:
Total budgeted needs:
Less: Beginning inventory:
Units of raw material to be purchased: