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Four grams of musk oll are required for each bottle of Mink Garess, a very popular peifume made by a small company in western Siberia.

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Four grams of musk oll are required for each bottle of Mink Garess, a very popular peifume made by a small company in western Siberia. The cost of the musk oll is $2.20 per gram. Budgeted production of Mink Caress Is given below by quarters for Year 2 and for the first quarter of Year 3 : Musk oll has become so popular as a perfume ingredient that it has become necessary lo caryy large inventorles as a precaution against stock-outs. For this reason, the inventory of musk oll at the end of a quarter mustbe equal to 20% of the following quarter's production needs. Some 80,000 grams of musk oll will be on hand to start the filist quarter of Year 2 Pequired: 'repare a direct materials budget for musk oll bv

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