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3. Prepare a direct materials budget showing the quantity of solvent H300 to be purchased for July, August and September, and for the quarter in total. Pearl Products Limited Direct Materials Budget July AugustSeptember Third Quarter Units of raw materials needed to meet production Total units of raw materials needed Units of raw materials to be purchased

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Answer #1

Production budget

July August september October
Budgeted unit sales 41000 46000 56000 36000
Add: Desired ending inventory 14500 17000 12000 9500
Total needs 55500 63000 68000 45500
Less; Beginning inventory -13250 -14500 -17000 -12000
Required production in units 42250 48500 51000 33500

Direct material budget

July August September Quarter
Required production in units 42250 48500 51000 141750
Raw material per unit 3 3 3 3
Units of raw material needed to production 126750 145500 153000 425250
Add: Desired ending inventory 72750 76500 50250 50250
Total Units of raw material needed 199500 222000 203250 475500
Less; Beginning inventory -60000 -72750 -76500 -60000
Units of raw materials to be purchased 139500 149250 126750 415500
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