Production Budget and Direct Materials Purchases Budgets

Peanut Land Inc. produces all$-$natural organic peanut butter. The peanut butter is sold in $12-$ounce jars. The sales budget for the first four months of the year is as follows:

Unit Sales Dollar Sales $($$$)$

January $40,00080,000$

February $50,000100,000$

March $70,000140,000$

April $62,000124,000$

Company policy requires that ending inventories for each month be $10\%$ of next month's sales. At the beginning of January, the inventory of peanut butter is $36,000$ jars.

Each jar of peanut butter needs two raw materials: $24$ ounces of peanuts and one jar. Company policy requires that ending inventories of raw materials for each month be $20\%$ of the next month's production needs. That policy was met on January