Required information Miami Solar manufactures solar panels for industrial use. The company budgets production of 4,300 units (solar panels) in July and 5,800 units in August. Each unit requires 3 pounds of direct materials, which cost $6 per pound. The company's policy is to maintain direct materials inventory equal to 30% of the next month's direct materials requirement. As of June 30, the company has 3,870 pounds of direct materials in inventory, which complies with the policy. Prepare a direct materials budget for July. MIAMI SOLAR Direct Materials Budget For Month Ended July 31 Budget production (units) 4,300 Materials requirements per unit 3 Materials needed for production (lbs.) 12,900 Add: Budgeted ending inventory (lbs.) Total materials requirements (lbs.) Less: Beginning inventory (lbs.) Materials to be purchased (lbs.) Materials price per pound Budgeted cost of direct materials purchases 3,870