Production and Raw Materials Budget: Hai Dunna Wanna Go Ltd. manufactures hula hoops, whatever that is. They need a special type of plastic, often hard to get, for the hoops. This year they plan to order the plastic ahead of time so they will cover three months of production without running out, just in case more ordering problems come up. Following is the information that should be useful to predict how much plastic they would need for July and August (only):

1. Production of Hula Hoops: They want to keep at least 25% of the next months sales to make sure they have sufficient quantities, given that sales of this highly sought after product is not so predictable. The June 30^th finished hoop inventory was 30,000 hoops.
2. Sales are budgeted as follows:
   1. July 50,000 hoops
   2. August 80,000 hoops
   3. September 40,000 hoops

Required: Prepare a production budget for July and August.