It takes two pounds of plastic and one receiving/charging unit to make each Clear Channels radio. The plastic costs $0.75 per pound (it is very high-quality ), and the receiving/charging unit costs $7.50 each. The company keeps enough inventory on hand to make 30% of the next month’s production. Opening inventory for the plastic is 500,000 pounds, and there are 200,000 receiving/charging units on hand. Using this information plus that developed in Exercise 10, prepare the materials budgets for Clear Channels. Increase ending inventory in Quarter 4 by 25% of Quarter 3’s total. 

Data from Exercise 10

Clear Channels makes portable radios that can be used during storms. The radios do not require an outside source of power because the battery is charged with a crank. They are a highly prized item in people’s home emergency kits. Sales are strong and growing each quarter. Opening inventory is 250,000 units. Quarter 1 sales are projected to be 1,000,000 units, Quarter 2 sales 1,250,000 units, Quarter 3 sales 1,500,000 units, Quarter 4 sales 1,750,000 units, and sales in the first quarter of next year are expected to top 2,000,000 units. The company’s policy is to keep 25% of the next period’s projected sales on hand at the end of each quarter. Using this information, please develop the production budget for Clear Channels.