Dallas Industries has adopted the following production budget for the first 4 months of 2013.
|
Month
|
Units
|
Month
|
Units
|
|
January
|
10,000
|
March
|
5,000
|
|
February
|
8,000
|
April
|
4,000
|
Each unit requires 3 pounds of raw materials costing $2 per pound. On December 31, 2012, the ending raw materials inventory was 9,000 pounds. Management wants to have a raw materials inventory at the end of the month equal to 30% of next month's production requirements.
Instructions
Prepare a direct materials purchases budget by month for the first quarter.