Zortek corp. budgets production of 380 units in january and 270 units in february. each finished unit requires four pounds of raw material z, which costs $3 per pound. each month’s ending inventory of raw materials should be 50% of the following month’s budgeted production. the january 1 raw materials inventory has 190 pounds of z. prepare a direct materials budget for january.

Instructions are listed below

Explanation:

Giving the following information:

Zortek Corp. budgets production of 380 units in January and 270 units in February. Each finished unit requires four pounds of raw material Z, which costs $3 per pound. Each month’s ending inventory of raw materials should be 50% of the following month’s budgeted production. The January 1 raw materials inventory has 190 pounds of Z.

Prouction January= 380 units*4 pounds= 1520 punds

Production Febreaury= (270*4pounds)/2= 540 pounds

Initial inventory= 190 pounds (-)

Purchase= 1870 pounds

answer; i believe the correct answer is (a) purchase of treasury stock;