Electro Company manufactures transmissions for electric cars. Management reports ending nished goods inventory for the first quarter at 90,000 units. The following unit sales are budgeted during the rest ofthe year: second quarter, 450,000 units; third quarter, 525,000 units; and fourth quarter, 475,000 units. Company policy calls for the ending finished goods inventory of a quarter to equal 20% of the next quarter's budgeted unit sales. Prepare a production budget for both the second and third quarters that shows the number of transmissions to manufacture. Budgeted sales units 450,000 m _ Delray Manufacturing needs to better budget and analyze costs. While Delray has experienced high sales growth, it has struggled to effectively manage costs and inventories. Delray aims to end each month with direct materials inventory equal to 40% of next month's production needs. Each finished unit requires 4 pounds of direct materials and 2 hours of direct labor. Delray budgets $12,000 of fixed overhead costs per month. A Tableau Dashboard is provided to aid our analysis. Sales Forecast & Production Budget (in Units) 1,500 Budgeted Production Sales Forecast 1,200 Budgeted Production 900 Sales Forecast 600--- 300 April May June July Ending Direct Materials Inventory by Month March April Solve for this value May Solve for this value June Solve for this value 400 800 1200 1600 2000 Direct Materials (Pounds)4UU LEUV LOUU Direct Materials (Pounds) Direct labor rate Direct materials cost Variable overhead rate #tableau 1. Prepare a direct materials budget for each month of April, May, and June. 2. Assume the company decides to end each month with direct materials inventory equal to 35% of next month's production needs, instead of 40%. How will this decision impact the budgeted cost of direct materials for April? Complete this question by entering your answers in the tabs below. Required 1 Required 2 Prepare a direct materials budget for each month of April, May, and June. DELRAY MANUFACTURING Direct Materials Budget For April, May, and June April May June Units to produce 880 1, 100 1,075 units Materials needed for production (lbs.) Total materials required (Ibs.) Materials to purchase (Ibs. 0 0 Materials cost per pound Cost of direct materials purchases Required 1 Required 2 >