Miami Solar manufactures solar panels for industrial use. The company budgets production of 4,200 units (solar panels) in July and 4,800 units in August. QS 20-13 Manufacturing: Direct materials budget LO P1 Each unit requires 4 pounds of direct materials, which cost $6 per pound. The companys policy is to maintain direct materials inventory equal to 20% of the next months direct materials requirement. As of June 30, the company has 3,360 pounds of direct materials in inventory, which complies with the policy.

Prepare a direct materials budget for July

MIAMI SOLAR
Direct Materials Budget
For Month Ended July 31
Budget production (units)	4,200
Materials requirements per unit	4
Materials needed for production (lbs.)
Add: Budgeted ending inventory (lbs.)
Total materials requirements (lbs.)
Less: Beginning inventory (lbs.)
Materials to be purchased (lbs.)
Materials price per pound
Budgeted cost of direct materials purchases