Preparing production budget and direct materials budget
The sales department of C. Howland Manufacturing Co. has forecast sales in March to ne 20,000 units. Additional information follows:
Finished goods inventory, March 1...................................3,000 units
Finished goods inventory required, March 31........................1,000 units
Materials used in production:

Prepare the following:
a. A production budget for March (in units).
b. A direct materials budget for the month (in units and dollars).

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Required Inventory Inventory March 31 Standard Cost March 1 A (one gallon per unit) ... B (one pound per unit).... 500 gal 1,000 lb 1,000 gal $2 per gal $1 per Ib 1,000 lb