DeWitt Industries has adopted the following production budget for the first 4 months of 2017.

Each unit requires 2 pounds of raw materials costing $3 per pound. On December 31, 2016, the ending raw materials inventory was 4,000 pounds. Management wants to have a raw materials inventory at the end of the month equal to 20% of next month’s production requirements.

Instructions

Prepare a direct materials purchases budget by month for the first quarter.

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Month Units Month Units March January February 10,000 8,000 5,000 4,000 April