Smith Industries manufactures a popular interactive stuffed animal for children that requires three computer chips inside each toy. The company pays $1 for each computer chip. To help to guard against stockouts of the computer chip, Smith Industries has a policy that states that the ending inventory of computer chips should be at least 30% of the following month's production needs. The production schedule for the first four months of the year is as follows: Click the icon to view the production schedule.) Requirement Prepare a direct materials budget for the first quarter that shows both the number of computer chips needed and the dollar amount of the purchases in the budget. Prepare the direct materials budget by first calculating the total quantity needed, then complete the budget. Smith Industries Direct Materials Budget For the Months of January through March Quarter Units to be produced 5.500 4,900 15,000 January February March 15.500 14.700 13.800 45.000 Multiply by: Quantity of direct materials needed per unit Quantity needed for production Plus: Desired ending inventory of direct materials Total quantity needed PUOI POU stuired and IUI LIIelulut Ilyuncu f the computer chip, Smith Industries has a policy that states that t eds. The production schedule for the first four months of the year is er that shows both the number of computer chips needed and the do Data Table Stuffed animals to be produced ng January ..... 5,500 | February .... : 4,900 4,600 4,700 March April .. pei : rials Print Done en click Check