Hospitable Co. provides sales forecast the next four months;

Sales (units) April May June July

500 580 540 620

The company wants to end each month with ending finished goods inventory equal to 25% of next months sales. Finished goods inventory on April 1 is 190 units. Assume Julys budget production is 540 units . Prepare a production budget for the month of April, May and June.

Each finished unit requires unit five pounds of raw materials and the company wants to end each month with raw materials inventory equal to 30% of next months production needs . Beginning raw materials inventory for April was 663 pounds. Assume direct materials cost $4 per pound. Prepare a direct materials budget for April, May, and June.