This is the amount of beginning inventory. See the correct answer for a complete explanation.
This answer results from assuming that each unit of finished product requires only one unit of raw materials. Each unit of finished product requires three units of raw materials.
This is the ending inventory amount. See the correct answer for a complete explanation.
This is a basic question of units needed in a period, but it is about the number of units of the raw materials that are needed. There are 3 units of raw materials in a finished unit. The amount needed in the third quarter itself is 102,000 units of raw materials (3 × 34,000 finished units). In addition, the ending inventory is 30% of the next quarter's needs. This is 43,200 units of raw materials (48,000 finished units × 3 × .3). The beginning inventory was 30% of the current quarter's needs or 30,600 (102,000 × .3). Beginning Inventory + Purchases ? Amount Used = Ending Inventory 30,600 + Purchases ? 102,000 = 43,200 Purchases = 114,600 A total of 114,600 units of raw materials need to be purchased this period.
|
