*Problem 10.37A Lyon Factory Ltd. manufactures two products: chairs and stools. Each chair requires 3 m of upholstery and 4 kg of steel. Each stool requires 2 m of upholstery and 5 kg of steel. Upholstery costs $2 per metre and steel costs $5 per kilogram. Lyon Factory expects inventories at January 1, 2020, to be as follows: Chairs Stools Upholstery Steel 25 units 14 units 75 m 150 kg Inventories of raw materials should not be allowed to fall below the amounts given as at January 1, 2020. Inventories of finished furniture at the beginning of each month should be enough to cover 25% of the anticipated sales for that month. Upholstery is ordered in units of 100 m and steel in units of 50 kg. Half of the materials purchased are paid for in the month of purchase and the other half in the following month. The sales budget for the first three months of the year 2020 is as follows: January February March Chairs 100 units 120 units 88 units Stools 56 units 76 units 64 units Calculate the cash disbursements in February for purchases of steel. Steel requirements for January and February Chairs Stools Jan Feb Jan Feb V Quantity of purchases in January and February Jan Feb Cost of purchases in January and February Jan Steel purchases rounded to purchasing lots Feb Cost per kilogram Total cost for steel purchases S Cash disbursements for February Current month Month following