Exercise $8-3($Algo$)$ Direct Materials Budget $[$LO$8-4]$

Two grams of musk oil are required for each bottle of Mink Caress, a very popular perfume made by a small company in western Siberia. The cost of the musk oil is $$1\mathrm{.}50$ per gram. Budgeted production of Mink Caress is given below by quarters for Year $2$ and for the first quarter of Year $3$:

Year $2$ Year $3$

First Second Third Fourth First

Budgeted production, in bottles $74,000104,000164,000114,00084,000$

The inventory of musk oil at the end of a quarter must be equal to $20\%$ of the following quarter$$s production needs. Some $29,600$ grams of musk oil will be on hand to start the first quarter of Year $2.$

Required:

Prepare a direct materials budget for musk oil, by quarter and in total, for Year $2.$