Question 2 (19 Marks) Franklin Products Limited manufactures and distributes a number of products to retailers. One of these products, SuperStick, requires four kilograms of material D236 in the manufacture of each unit. The company is now planning raw materials needs for the third quarter-July, August, and September. Peak sales of SuperStick occur in the third quarter of each year. To keep production and shipments moving smoothly, the company has the following inventory requirements: a. b. The finished goods inventory on hand at the end of each month must be equal to 8,350 units plus 20% of the next month's sales. The finished goods inventory on June 30 is budgeted to be 22,420 units. The raw materials inventory on hand at the end of each month must be equal to 40% of the following month's production needs for raw materials. The raw materials inventory on June 30 for material D236 is budgeted to be 130,400 kilograms. The company maintains no work in process inventories. c. A sales budget for Super Stick for the last six months of the year follows: Month Budget Unit Sales July 60,700 August 75,350 September 105,700 October 53,350 November 30,350 December 15,140 Required: Prepare a production budget for SuperStick for July, August, September, and October (9 Marks) July 60,700 August 75,350 September 105,700 October 53,350 Budgeted Sales Add: Desired ending inventory Total needs Less: Beginning inventory Required Production Prepare a direct materials purchases budget showing the quantity of material D236 to be purchased for July, August, and September and for the quarter in total. (10 Marks) July August September Total Required Production Material D236 needed per unit Production needs Add: desired ending inventory Total Material D236 needs Less: beginning inventory Material D236 purchases