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Quiz Company developed the following sales forecasts for the first five months of the year. Unit sales January 40,000 February 50,000 March 60,000 April 60,000

Quiz Company developed the following sales forecasts for the first five months of the year.

Unit sales

January

40,000

February

50,000

March

60,000

April

60,000

May

62,000

Each unit is expected to sell for a price of $205.

Finished goods inventory on January 1 is projected to be 32,000 units. Quiz Company plans production to have ending inventory equal to 80% of the next months sales.

Each unit requires two materials: Material 1 and Material 2. Information on the materials is as follows.

Direct materials

Per-unit usage

DM cost per lb.

Material 1

10 lbs.

$8

Material 2

6

5

Quiz Companys materials inventory policy is to have ending materials on hand to meet 50% of the following months production needs. Inventory on January 1 is expected to satisfy this policy.

Each unit requires 3 hours of direct labor. Direct labor cost is $14.25 per hour.

Prepare a sales budget, production budget, direct materials purchases budget, and direct labor budget for the first quarter.

Determine total direct materials cost for March.

Note: Give your answer using dollar signs and commas but no decimal points (cents).

Example: $12,345

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