The Direct-Material Budget Shows the Number of Units and the Cost

question 37

Multiple Choice

The direct-material budget shows the number of units and the cost of material to be purchased and used during a budget period. Which of the following formulas is this schedule based on?

• A) Raw materials required for production + desired ending inventory of raw material = Total raw material required - expected beginning inventory of raw material = Raw material to be purchased.
• B) Raw materials required for production - desired ending inventory of raw material = Total raw material required + expected beginning inventory of raw material = Raw material to be purchased.
• C) Total raw material required + Raw materials required for production = desired ending inventory of raw material = Raw material to be purchased.
• D) Raw material to be purchased + expected beginning inventory of raw material = Desired ending inventory of raw material x cost per unit = Raw materials required for production.
• E) Raw material required for production ÷ [(expected beginning inventory of raw material + desired ending inventory of raw material) /2] = Raw material to be purchased.

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Definitions:

Nonhierarchical Environment

An organizational structure where power and authority are not held by specific positions or ranks, promoting equality.

Presentations

The act of showing and explaining the content of a topic to an audience or learner.

Gestures

Movements of the body, especially the hands and arms, that express ideas or feelings.

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The ability to convincingly present arguments or ideas in order to influence the thoughts or actions of others.