Respuesta :
10,700 lbs need to be ordered. 9500 is what will be consumed, add wanted inventory of 2200 subtract 1000 for 10700= (9500+2200)-1000
In order to meet its obligations, the Byrd Company should purchase 10,700 pounds of direct materials.
The company currently has 1,000 pounds in inventory and would like to have 2,200 pounds at the end of production.
The current period requires 9,500 pounds to be used in production.
The purchases needed to achieve all this can be found by the formula:
Ending inventory = Beginning inventory + Purchases - Direct materials used
2,200 = 1,000 + Purchases - 9,500
Purchases = 9,500 + 2,200 - 1,000
Purchases = 10,700 pounds
In conclusion, the company should purchase 10,700 pounds
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