One BUDGET QUESTIONS Sakyi Ltd produces two products, Cake and Bluna, which use the same raw materials, oil and fat. One unit of Cake uses 3 litres of oil and 4kg of fats. One unit of Bluna uses 5 litres of oil and 2 kg of fat. A litre of oil is expected to cost 3,000 and a kg of fat 7,000. Budgeted sales for 2001 are 8,000 units of Cake and 6,000 units of Bluna; finished goods in stock at 1/1/2001 are 1,500 units of Cake and 300 units of Bluna, and the company plans to hold stocks of 600 units of each of the products at 31/12/01. Stocks of raw materials are 6,000 litres of oil and 2,800 kg of fat at 1/1/01, and the company plans to hold 5,000 litres and 3,500 kg respectively at 31/12/01. The store's manager has suggested that a provision should be made for damages and deterioration of items held in store as follows: Cake - loss of 50 units Bluna-loss of 100 units Oil - loss of 500 litres Fat - loss of 200 kg You are required to: Prepare a material purchases budget for the year 2001