Exercise 8-10 (Algo) Production and Direct Materials Budgets [LO8-3, LO8-4] Pearl Products Limited of Shenzhen, China, manufactures and distributes toys throughout South East Asia. Three cubic centimeters (cc) of solvent H300 are required to manufacture each unit of Supermix. The company is planning its raw materials needs for the third quarter. A monthly sales budget for Supermix for the third and fourth quarters of the year follows. Required: 1. Prepare a production budget for Supermix for the months July, August, September, and October. Note that finished goods inventory on hand at the end of each month must equal 3,000 units of Supermix PLUS 20% of the next month's sales. The finished goods inventory on June 30 is budgeted to be 17,200 units. 2. Prepare a direct materials budget showing the quantity of solvent H300 to be purchased for July, August, and September. The raw materials inventory on hand at the end of each month must equal one-half of the following month's production needs for raw materials. The raw materials inventory on June 30 is budgeted to be 108,000cc of solvent H30O. Complete this question by entering your answers in the tabs below. Complete this question by entering your answers in the tabs below. Prepare a production budget for Supermix for the months July, August, September, and October