Shaver Bicycle Shop assembles and sells tricycles and bicycles. The frames are purchased from one supplier and the wheels from another. The following materials are required:

Bicycles                                                Tricycles

One 22-inch frame, $35 ……………..One 12-inch frame, $15

Two 22-inch wheels, $10 each ……....Two 4-inch wheels, $10 each

……………………………………….One 12-inch wheel, $7.50

Management anticipates that 150 bicycles and 160 tricycles will be assembled during the first quarter of 2010. On December 31, 2009, the following assembly parts are on hand:

22-inch frames . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12

22-inch wheels . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20

12-inch frames . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8

4-inch wheels . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24

12-inch wheels . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10

Management also decides that, beginning in January, the inventory of parts on hand at the end of each month should be sufficient to make 10 bicycles and 10 tricycles.

Prepare a budget for direct materials purchases for the first quarter of 2010. (Note: You are not required to extend the budget to determine the budget for cash payments to suppliers.)