Pearl Products Limited of Shenzhen, China, manufactures and distributes toys throughout South East Asia. Three cubic centimeters (cc) of solvent H300 are required to manufacture each unit of Supermix, one of the company's products. The company is planning its raw materials needs for the third quarter , the quarter in which peak sales of Supermix occur. To keep production and sales moving smoothly, the company has the following Inventory requirements: a. The finished goods inventory on hand at the end of each month must equal 2,000 units of Supermix plus 25% of the next month's sales. The finished goods inventory on June 30 is budgeted to be 14,250 units. b. The raw materials inventory on hand at the end of each month must equal one-half of the following month's production needs for raw materials. The raw materials inventory on June 30 is budgeted to be 75,375 cc of solvent H300. c. The company maintains no work in process inventories. A monthly sales budget for Supermix for the third and fourth quarters of the year follows. July August September October November December Budgeted Unit Sales 49.000 54,000 64.000 44,000 34,000 24,000 Required: 1. Prepare a production budget for Supermix for the months July, August September, and October, 3. Prepare a direct materials budget showing the quantity of solvent H300 to be purchased for July August, and September, and for the quarter in total Answer is complete but not entirely correct. Complete this question by entering your answers in the tabs below. Required 1 Required Prepare a direct materials budget showing the quantity of solvent H300 to be purchased for July August, and September, and for the quarter in total Pearl Products Limited Direct Materials Budget July August September Third Quarter July August September October November December Unit Sales 49,000 54,000 64,000 44,000 34,000 24,000 0.52 points Required: 1. Prepare a production budget for Supermix for the months July August September, and October 3. Prepare a direct materials budget showing the quantity of solvent H300 to be purchased for July, August, and September, and for the quarter in total Answer is complete but not entirely correct. Complete this question by entering your answers in the tabs below. Required 1 Required 3 Prepare a direct materials budget showing the quantity of solvent H300 to be purchased for July, August, and September, and for the quarter in total September 59,000 Pearl Products Limited Direct Materials Budget July 50.250 Ice 150.750 84,750 235.500 75,375 160,125 Required production in units of finished goods Units of raw materials needed per unit of Sished goods Units of raw materials needed to meet production Add Desired units of ending was inventory Total of raw materials needed Adt: Units of beginning finished goods inventory Units of raw materials to be purchased loc August 56,500 3o 169,500 88.500 258,000 84.750 173.250 177,000 62.250 239.250 88.500 150,750 Third Quarter 165,750 3 497,250 62,250 550,500 75,375 464, 125
