Required information Miami Solar manufactures solar panels for industrial use. The company budgets production of 5,700 units (solar panels) in July and 5,000 units in August. Each unit requires 3 pounds of direct materials, which cost $7 per pound. The company's policy is to maintain direct materials inventory equal to 20% of the next month's direct materials requirement. As of June 30, the company has 3,420 pounds of direct materials in inventory. Prepare the direct materials budget for July. Units to produce MIAMI SOLAR Direct Materials Budget July 5,700 3 Materials required per unit (pounds) Materials needed for production (pounds) Add: Desired ending materials inventory Total materials required (pounds) Materials to purchase (pounds) Cost of direct materials purchases 17,100