Croy Inc has the following projected sales for the next five

Croy Inc. has the following projected sales for the next five months: 4,640 4,180 3,910 Croy\'s finished goods inventory policy is to have 50 percent of the next month\'s sales on hand at the end of each month. Direct material costs $3.50 end of each month. Raw materials on hand at March 31 totaled 3,723 pounds. Required: and each unit requires 2 pounds. Raw materials inventory policy is to have 50 percent of the next month\'s production needs on hand at the for April, May, and June. (Do Not nearest whole number.) (Units) nd June. (Use rounded 2. calculations. Round your answers to 2 decimal places.) Budgeted Production units in intermediate

Solution

1) April May June Budgeted Production (Units) 3,723 4,263 4,410 Working: a. April May June July Budgeted Sales                3,560                  3,885              4,640                   4,180 Add:Desired Ending Inventory                1,943                  2,320              2,090                   1,955 Total                  5,503                  6,205              6,730                   6,135 Less:Beginning Inventory                1,780                  1,943              2,320                   2,090 Budgeted Production                3,723                  4,263              4,410                   4,045 b. March month\'s ending inventory = April Month\'s Sales x 50% =              3,560 x 50% =              1,780 April Month\'s Ending Inventory =              3,885 x 50% =         1,943 May Month\'s Ending Inventory =              4,640 x 50% =         2,320 June Month\'s Ending Inventory =              4,180 x 50% =         2,090 July Month\'s Ending Inventory =              3,910 x 50% =         1,955 2) April May June Budgeted cost of Materials Purchased $   27,947.50 $     30,353.75 $ 29,592.50 Working: a. April May June Budgeted Production (Units)                3,723                  4,263              4,410 Raw material required per unit                        2                          2                       2 Total Raw Material required for producton                7,445                  8,525              8,820 Add:Desired ending Inventory                4,263                  4,410              4,045 Total              11,708                12,935            12,865 Less:Beginning Inventory                3,723                  4,263              4,410 Budgeted Material purchase in units                7,985                  8,673              8,455 Material cost per unit $              3.50 $                3.50 $            3.50 Budgeted Material Costs $   27,947.50 $     30,353.75 $ 29,592.50 b. Ending inventory of : Next Month Production Material each unit Total Materials needed 50% of material needed April                  4,263                       2                   8,525                  4,263 May                    4,410                       2                   8,820                  4,410 June                  4,045                       2                   8,090                  4,045