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Chandler Ltd

Price: $1.99


Chandler Ltd. estimates sales for the second quarter of 2014 will be as follows.

Month  Units 
April  2,550
May  2,475
June  2,390

The target ending inventory of finished products is as follows.

31-Mar 2,000
30-Apr 2,230
31-May 2,200
30-Jun 2,310

Two units of material are required for each unit of finished product. Production
for July is estimated at 2,700 units to start building inventory for the fall sales period.
Chandler’s policy is to have an inventory of raw materials at the end of each month equal
to 50% of the following month’s production requirements.
Raw materials are expected to cost $4 per unit throughout the period.

Instructions
Calculate the May raw materials purchases in dollars.

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