Question - Tall Oak, Inc produces ruler from plastic resin. Tall Oak has estimated production and sales of ruler in unit for the next 2 month as:
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May
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June
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Estimated Production
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42,000
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48,000
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Estimated Sales
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50,000
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36,000
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Each ruler requires 0.25 pounds of resin. The cost of resin is 4.50 per pound. Tall Oak wants to have 20% of the next month's material requirements on hand at the end of each month.
Prepare a direct materials purchases budget for the month of May.