Moretti’s Frozen Pizza Inc. has determined from its production budget the following estimated production volumes for 12˝ and 16˝ frozen pizzas

Moretti’s Frozen Pizza Inc. has determined from its production budget the following estimated production volumes for 12˝ and 16˝ frozen pizzas for September 2014:



















Units
12” Pizza 16” Pizza
Budgeted production volume 4,700 8,100
There are three direct materials used in producing the two types of pizza. The quantities
of direct materials expected to be used for each pizza are as follows:
12” Pizza 16” Pizza
Direct materials:
Dough 0.80 lb. per unit 1.40 lbs. per unit
Tomato 0.50 0.90
Cheese 0.70 1.20
In addition, Moretti’s has determined the following information about each material:
Dough Tomato Cheese
Estimated inventory, September 1, 2014 550 lbs. 180 lbs. 315 lbs.
Desired inventory, September 30, 2014 620 lbs. 160 lbs. 345 lbs.
Price per pound $0.90 $1.70 $2.40


Prepare September’s direct materials purchases budget for Moretti’s Frozen Pizza Inc.


Answer:
























MORETTI’S FROZEN PIZZA INC.
Direct Materials Purchases Budget
For the Month Ending September 30, 2014
Dough Tomato Cheese Total
Units required for production:
12" pizza 3,7601 2,3502 3,2903
16" pizza 11,3404 7,2905 9,7206
Plus desired inventory,
September 30, 2014 620 160 345
Total 15,720 9,800 13,355
Less estimated inventory,
September 1, 2014 550 180 315
Total units to be purchased 15,170 9,620 13,040
Unit price × $0.90 × $1.70 × $2.40
Total direct materials to
be purchased $13,653 $16,354 $31,296 $61,303
1 4,700 × 0.80 lb.
2 4,700 × 0.50 lb.
3 4,700 × 0.70 lb.
4 8,100 × 1.40 lbs.
5 8,100 × 0.90 lb.
6 8,100 × 1.20 lbs.