Preston, Inc., manufactures wooden shelving units for collecting and sorting mail. The company expects to produce 290 units in July and 370 units in August. Each unit requires 12 feet of wood at a cost of $1.30 per foot. Preston wants to always have 250 feet of wood on hand in materials inventory.

Compute Preston's direct materials purchases budget for July and August.

July August

Budgeted Direct materials Purchases $4,524 $5,772