Problem:
Material purchases budget) San Diego Culvert Company has budgeted sales of 190,000 feet of its concrete culvert products for June 2000. Each foot of product requires 12 pounds of concrete ($0.10 per pound) and 15 pounds of gravel ($0.03 per pound). Actual beginning inventories and projected ending inventories are shown below.
|
June 1
|
June 30
|
|
Finished Goods Inventory (in feet)
|
24,500
|
20,000
|
|
Concrete (in pounds)
|
82,000
|
68,600
|
|
Gravel (in pounds)
|
65,300
|
92,500
|
a. How many pounds of concrete does San Diego Culvert plan to purchase in June? What will be the cost of those purchases?
b. How many pounds of gravel does San Diego Culvert plan to purchase in June? What will be the cost of those purchases?