Direct Materials Purchases and Cash Payments. The Campbell Company prepared a production budget for the first months of 1999 as follows:

Two units of Material 03 are required for each pound of product at a cost per unit of $1.50. One unit of Material 08 is required for each pound of product at a cost per unit of $5.
Forty percent of both materials needed in a month must be purchased in the preceding month. Thirty percent of the materials cost is paid during the month of purchase, and the other 70 percent is paid in the following month. Accounts payable at the beginning of January for materials purchases is estimated to be $44,000.
Required:
1. Determine the number of units to be purchased each month.
2. Determine the cost of purchases by month.
3. Prepare a budget of cash payments for materials by month.

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January 18,000 units February 16,000 March.... 20,000 April 24,000