Direct Materials Purchases Budget

Anticipated sales for Sure Grip Tire Company were 38,000 passenger car tires and 11,000 truck tires. Rubber and steel belts are used in producing passenger car and truck tires according to the following table:

	Passenger Car	Truck
Rubber	28 lbs. per unit	65 lbs. per unit
Steel belts	4 lbs. per unit	10 lbs. per unit

The purchase prices of rubber and steel are $3.6 and $4.7 per pound, respectively. The desired ending inventories of rubber and steel belts are 36,000 and 7,000 pounds, respectively. The estimated beginning inventories for rubber and steel belts are 42,000 and 6,000 pounds, respectively.

Prepare a direct materials purchases budget for Sure Grip Tire Company for the year ended December 31, 2016. When required, enter unit prices to the nearest cent.

Sure Grip Tire Company
Direct Materials Purchases Budget
For the Year Ending December 31, 2016
	Rubber	Steel Belts	Total
Pounds required for production:
Passenger tires	lbs.	lbs.
Truck tires
Plus desired inventory, December 31, 2016
Total	lbs.	lbs.
Less estimated inventory, January 1, 2016
Total units purchased	lbs.	lbs.
Unit price	x $	x $
Total direct materials to be purchased	$	$	$