LO4 MSC M21-21. Production and Purchases Budgets in Units At the end of business on June 30, the PE Rug Company had 35,000 square yards of rugs and 100,000 pounds of raw materials on hand. Budgeted sales for the third quarter are Month July Sales 50,000 sq. yards August September October. 35,000 sq. yards 42,000 sq. yards 48,000 sq. yards The PE Rug Company wants to have sufficient square yards of finished product on hand at the end of each month to meet 60% of the following month's budgeted sales and sufficient pounds of raw materials to meet 40% of the following month's production requirements. Seven pounds of raw materials are required to produce one square yard of carpeting. REQUIRED Prepare a production budget for the months of July, August, and September and a purchases budget in units for the months of July and August. >