Smoke, Inc. makes and sells buckets. Each bucket uses 1/2 pound of plastic. Budgeted production of buckets in units for the next
three months is as follows: April May June Budgeted production 21,000 22,000 24,000 The company wants to maintain monthly ending inventories of plastic equal to 25% of the following month's budgeted production needs. The cost of plastic is $2.20 per pound. Prepare a direct materials purchases budget for the month of May. (Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45). Round pounds of plastic needed for each bucket to 1 decimal palce and cost per pound to two decimal palces.) : : $
The total budgeted direct materials amounts to $24,750.
Calculating the production budget multiplied by required materials yields:
For April, it's 21,000 x 0.5 lbs = 10,500 pounds.
For May, it's 22,000 x 0.5 lbs = 11,000 pounds.
For June, it's 24,000 x 0.5 lbs = 12,000 pounds.
Starting inventory is derived from 11,000 x 25% = 2,750 lbs. Production requirements total 11,000 lbs with an ending inventory of 3,000 lbs calculated from 12,000 x 25%.
The direct materials budget for May is defined as follows:
Budgeted production equals 22,000 units; materials per unit totals 0.5 lbs. Therefore, needed materials for production amount to 11,000 lbs. Ending inventory aligns at 3,000 lbs and beginning inventory stands at 2,750 lbs. Calculating materials to be purchased results in:
11,000 + 3,000 - 2,750 = 11,250 lbs, and with a price of $2.20 per pound,
The total budgeted direct materials cost becomes $24,750.
To maximize Maggie's taste index, the best choice is 1 snack bar and 2 ice creams. Each snack bar weighs 37 grams with 120 calories and 5 grams of fat, while each ice cream accounts for 65 grams, 160 calories, and 10 grams of fat. Maggie saves room for no more than 450 calories and 25 grams of fat in her desserts, along with a minimum requirement of 120 grams of desserts daily.
Warby Parker is a company specializing in eyewear that produces designer glasses at affordable prices. The company's management believes in the importance of grounding its operations in Corporate Social Responsibility.
Explanation:
Warby Parker is an eyewear manufacturer creating designer glasses that remain budget-friendly. The management asserts that its operations should be based on principles of Corporate Social Responsibility.
Answer: This chart indicates that the marginal cost initially declines as the level of production rises.
Marginal cost is the expense incurred for producing an additional unit of a product. When production levels increase, marginal costs tend to fall at first.
In the short run, inputs like capital remain constant while labor becomes the variable factor changing with the number of units produced. Initially, increasing labor enhances productivity, lowering marginal costs. However, as even more labor is added, its productivity diminishes, triggering the law of diminishing marginal returns, which results in a rising marginal cost curve.
