Current Attempt in Progress Pargo Company is preparing its master budget for 2020. Relevant data pertaining to its sales, production, and direct materials budgets are as follows. Sales. Sales for the year are expected to total 2,000,000 units. Quarterly sales are 21%, 27%, 27%, and 25%, respectively. The sales price is expected to be $42 per unit for the first three quarters and $44 per unit beginning in the fourth quarter. Sales in the first quarter of 2021 are expected to be 10% higher than the budgeted sales for the first quarter of 2020. Production. Management desires to maintain the ending finished goods inventories at 20% of the next quarter's budgeted sales volume. Direct materials. Each unit requires 2 pounds of raw materials at a cost of $11 per pound. Management desires to maintain raw materials inventories at 10% of the next quarter's production requirements. Assume the production requirements for first quarter of 2021 are 500,000 pounds. Prepare the sales, production, and direct materials budgets by quarters for 2020. PARGO COMPANY Production Budget For the Quarter Ending December 31, 2020 Quarter 1 2 Expected Unit Sales 420000 540000 Add V: Desired Ending Finished Goods Units Total Required Units Less V: Beginning Finished Goods Units 84000 108000 Required Production Units PARGO COMPANY Production Budget For the Quarter Ending December 31, 2020 Quarter 2 3 4 Year 420000 540000 540000 500000 84000 108000 108000 100000 PARGO COMPANY Direct Materials Budget > Quarter Qua 1 2 > V: $ $ $ $ uarter 3 4 Year $ $ $ $