Selva Inc. makes keyboards for tablets, and packages them in crates containing $50$ keyboards per

crate. Planned production in units for the first three months of the coming year is:

$43,800$

$41,000$

$50,250$

January

February

March

Each keyboard requires two litres of chemicals and one plastic crate. Company policy requires

that ending inventories of raw materials for each month be $15$ percent of the next month$$s produc$-$

tion needs. That policy was met for the ending inventory of December in the prior year. The cost

of one litre of chemicals is $$0\mathrm{.}50.$ The cost of one crate is $$1\mathrm{.}60.($Note: Round all dollar amounts

to the nearest dollar.$)$

Required:

$1.$ Calculate the ending inventory of chemicals in litres for December of the prior year, and for

January and February. What is the beginning inventory of chemicals for January?

$2.$ Prepare a direct materials purchases budget for chemicals for the months of January and

February.

$3.$ Calculate the ending inventory of crates for December of the prior year, and for January

and February. What is the beginning inventory of crates for January?

$4.$ Prepare a direct materials purchases budget for crates for the months of January and

February.