3

Item 2

Item 2 2 points

Zira Co. reports the following production budget for the next four months.

	April		May		June		July
Production (units)	626		680		658		638

Each finished unit requires five pounds of raw materials and the company wants to end each month with raw materials inventory equal to 30% of next months production needs. Beginning raw materials inventory for April was 939 pounds. Assume direct materials cost $4 per pound. Prepare a direct materials budget for April, May, and June. (Round your intermediate calculations and final answers to the nearest whole dollar amount.)

ZIRA CO. Direct Materials Budget For April, May, and June April May 626 680 4 4 2,504 2,720 1,088 June 658 units 4 lbs. 2,632 lbs. lbs. Budgeted production (units) Materials requirements per unit Materials needed for production (lbs.) Budgeted ending inventory (lbs.) Total materials requirements (lbs.) Beginning inventory (lbs.) Materials to be purchased (lbs.) Cost per lb. Total budgeted direct materials cost $ 4 $ 4 $ 4 per lb