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Four grams of musk oil are required for each bottle of Mink Caress, a very popular perfume made by a small company in western Siberia.

Four 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 $1.50 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 88,000 118,000 178,000 128,000 98,000

Musk oil has become so popular as a perfume ingredient that it has become necessary to carry large inventories as a precaution against stock-outs. For this reason, the inventory of musk oil at the end of a quarter must be equal to 20% of the following quarters production needs. Some 70,400 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. (Round "Unit cost of raw materials" answers to 2 decimal places.)

Mink Caress
Direct Materials Budget - Year 2
Quarter
First Second Third Fourth Year
Required production in units of finished goods
Units of raw materials needed per unit of finished goods
Units of raw materials needed to meet production
Total units of raw materials needed 0 0
Units of raw materials to be purchased 0 0 0 0 0
Unit cost of raw materials
Cost of raw materials to be purchased

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