ACCOUNTING
Warren, Reeve and Duchac
Financial Accounting
Managerial Accounting
Carl Warren, James M. Reeve, Jonathan E. Duchac
Chapter 22
EX 22-10 Coca-Cola Enterprises is the largest bottler of Coca-Cola® in North America. The company purchases Coke® and Sprite® concentrate from The Coca-Cola Company, dilutes and mixes the concentrate with carbonated water, and then fills the blended beverage into cans or plastic two-liter bottles. Assume that the estimated production for Coke and Sprite two-liter bottles at the Dallas, Texas, bottling plant are as follows for the month of March: Coke 214,000 two-liter bottles Sprite 163,000 two-liter bottles. In addition, assume that the concentrate costs $80 per pound for both Coke and Sprite and is used at a rate of 0.2 pound per 100 liters of carbonated water in blending Coke and 0.15 pound per 100 liters of carbonated water in blending Sprite. Assume that two- liter bottles cost $0.08 per bottle and carbonated water costs $0.06 per liter.
Prepare a direct materials purchases budget for March 2010, assuming no changes between beginning and ending inventories for all three materials.
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