4. Hoops Manufacturing expects to produce 2,400 units in January and 3,700 units in February. The company expect to need 2.5 pounds of material for each unit and budgets $A/pound for the materials. The balance in the Direct Materials Inventory account on January 1 is 3,000 month's direct materials needed for production. What is the cost of budgeted purchases of direct materials needed for January? units. Hoops desires the ending balance in Direct Materials Inventory to be 30% of the next A) $49,000 B) $26,800 C) $23,100 D) $12,400 E) $5,775 5. Sammy, Inc. has budgeted to produce 15,000 units per month. Each unit requires 30 minutes of direct labor to complete. The direct labor rate is $100 per hour. Calculate the budgeted cost of direct labor for the month. A) $750,000 B) $450,000 C) $150,000 D) $275,000 E) $900,000 True (A) or False (B): Cost behavior is considered in developing the selling and administrative expense budget as costs are designated as variable or fixed. 6