Exercise 22-08 Fuqua Company's sales budget projects unit sales of part 1987 of 10,100 units in January, 12,600 units in February, and 13,700 units in March. Each unit of part 1987 requires 3 pounds of materials, which cost $4 per pound. Fuqua Company desires its ending raw materials inventory to equal 40% of the next month's production requirements, and its ending finished goods inventory to equal 20% of the next month's expected unit sales. These goals were met at December 31, 2019. Prepare a production budget for January and February 2020. FUQUA COMPANY Production Budget For the Two Months Ending February 28, 2020 V January February Expected Unit Sales Add H Desired Ending Finished Goods Inventory Total Required Units Less V Beginning Finished Goods Inventory : Required Production Units Prepare a direct materials budget for January 2020. FUQUA COMPANY Direct Materials Budget For the Month Ending January 31, 2020 January Units To Be Produced Direct Material Pounds Per Unit Total Pounds Needed for Production Add Desired Pounds in Ending Materials Inventory v Total Materials Required Less V : Beginning Direct Materials (Pounds) Direct Materials Purchases Cost Per Pound $ Total Cost of Direct Materials Purchases