Schickel Inc

question 140

Multiple Choice

Schickel Inc.regularly uses material B39U and currently has in stock 460 liters of the material for which it paid $3,128 several weeks ago.If this were to be sold as is on the open market as surplus material,it would fetch $5.95 per liter.New stocks of the material can be purchased on the open market for $6.45 per liter,but it must be purchased in lots of 1,000 liters.You have been asked to determine the relevant cost of 760 liters of the material to be used in a job for a customer.The relevant cost of the 760 liters of material B39U is:

• A) $4,902
• B) $4,672
• C) $4,522
• D) $6,450

Determine the required budgeted purchases of raw materials based on production needs and inventory policy.

Calculate total budgeted cash disbursements for raw materials purchases.

Understand cash budgeting including the minimum cash balance requirements and financing needs.

Prepare a detailed selling and administrative expense budget.

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