Kyler Manufacturing produces$$ self$-$watering planters for use in upscale retail establishments. Sales projections for the first five months of the upcoming year show the estimated unit sales of the planters each month to be as$$ follows:

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Inventory at the start of the year was $800$ planters. The desired inventory of planters at the end of each month should be equal to $25\%$ of the following$$ month's budgeted sales. Each planter requires two pounds of polypropylene$($a type of$$ plastic$).$ The company wants to have $20\%$ of the polypropylene required for next$$ month's production on hand at the end of each month. The polypropylene costs $$0\mathrm{.}10$ per pound.

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Part $1$

Requirement $1.$ Prepare a production budget for each month in the first quarter of the$$ year, including production in units for each month and for the quarter.

Kyler Manufacturing

Production Budget

For the Months of January through March

January

February

March

Quarter

Unit sales

$3,200$

$3,000$

$3,500$

$9,700$

Plus:

Desired ending inventory

Total needed

Less:

Beginning inventory

Units to produce

Part $2$

Requirement $2.$ Prepare a direct materials budget for the polypropylene for each month in the first quarter of the$$ year, including the pounds of polypropylene required and the total cost of the polypropylene to be purchased.

Start by preparing the direct materials budget through the total quantity$$ needed, then complete the budget.

Kyler Manufacturing

Direct Materials Budget

For the Months of January through March

January

February

March

Quarter

Units to be produced

Multiply by:

Quantity of direct materials needed per unit

Quantity needed for production

Plus:

Desired ending inventory of direct materials

Total quantity needed

Part $3$

Less:

Beginning inventory of direct materials

Quantity to purchase

Multiply by:

Cost per pound

Total cost of direct material purchases