Rokosz Corporation Makes One Product and It Provided the Following

question 152

Multiple Choice

Rokosz Corporation makes one product and it provided the following information to help prepare the master budget for the next four months of operations: a. The budgeted selling price per unit is $104. Budgeted unit sales for October, November, December, and January are 6,900, 7,100, 11,300, and 15,300 units, respectively. All sales are on credit.
B. Regarding credit sales, 30% are collected in the month of the sale and 70% in the following month.
C. The ending finished goods inventory equals 20% of the following month's sales.
D. The ending raw materials inventory equals 30% of the following month's raw materials production needs. Each unit of finished goods requires 5 pounds of raw materials. The raw materials cost $2.00 per pound.
E. The direct labor wage rate is $23.00 per hour. Each unit of finished goods requires 2.5 direct labor-hours.
If 60,500 pounds of raw materials are required for production in December, then the budgeted cost of raw material purchases for November is closest to:

• A) $91,880
• B) $139,520
• C) $79,400
• D) $115,700

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Definitions:

Muscular Organ

An organ composed primarily of muscle tissue, designed to contract and move or push substances through the body, such as the heart or stomach.

Temporarily Stores

Refers to the transient holding or preserving of information, goods, or energy until needed.

Urine

A liquid waste product filtered from the blood by the kidneys, stored in the bladder, and expelled from the body.

Cortex

The outermost layer of an organ or structure, such as the cerebral cortex of the brain, which is involved in numerous high-level functions including thought and action.