Logan Enterprises' Unit Production Is Budgeted for the First Six

question 64

Essay

Logan Enterprises' unit production is budgeted for the first six months of its upcoming fiscal year as follows:
Each unit of product requires 20 pounds of raw material that Logan purchases for $3.50 per pound.The company began the month of March with 13,160 pounds of raw material but wants its ending inventory of raw material to be 2% of the next month's production requirements beginning with the end of March.
Logan pays for 20% of its purchases in the month of purchase,with the remainder paid the following month.Determine the amount of planned cash disbursements for purchases of raw materials for April,May and June.

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Definitions:

Spreadsheet

A digital document that uses rows and columns to organize data, calculations, and information, commonly used in accounting and financial analysis.

Multiplier

A factor used in economics to quantify the effect of investment spending on the aggregate income or output of an economy.

Full Retirement Age

Age at which a person receives full retirement Social Security benefits.

IRA

An Individual Retirement Account, a saving tool that allows individuals to set aside money for retirement with tax advantages.