A sales budget is given below for one of the products manufactured by the Kat Ltd.:

January 21,000 units

February 36,000 units

March 61.000 units

April 41,000 units

May 31,000 units

June 25,000 units

The inventory of finished goods at the end of each month should equal 20% of the next month's sales. However, on December 31 the finished goods inventory totaled only 4,000 units.

Each unit of product requires three kilograms of raw material. Each kilogram costs $.75. Since the production of the raw material by Kat's suppliers is sometimes irregular, the company has a policy of maintaining an ending inventory at the end of each month equal to 30% of the next month's production needs. This requirement had been met on December 31.

Required:

Prepare a production budget for January, February and March. Prepare a direct material budget that results in the kilograms to be purchased and the total cost for each month (January, February, and March).