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On September 3 0 of Year 1 , JayBob Company had raw materials inventory of 5 , 0 0 0 pounds. Starting in October, JayBob

On September 30 of Year 1, JayBob Company had raw materials inventory of 5,000 pounds. Starting in October, JayBob intends to have an inventory policy of maintaining ending raw materials inventory at the end of every month equal to the next TWO months production needs. For example, ending inventory at the end of October should be equal to forecasted raw materials needs for November production plus forecasted raw materials needs for December production.
Five pounds of raw materials are needed in the production of one finished unit.
Forecasted PRODUCTION for the months October, Year 1 through December, Year 1 is as follows.
October 4,500 units
November 6,000 units
December 2,000 units
What is the amount of budgeted RAW MATERIALS PURCHASES for October?
57,500 pounds
40,000 pounds
67,500 pounds
62,500 pounds

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