1. Sonoma Corporations production budget calls for the following number of units to be produced each month for next year:

		Budgeted production
	Month 1	45,000 units
	Month 2		38,000 units
	Month 3	54,000 units
	Month 4	74,000 units

Each unit of product requires three pounds of direct material. The company's policy is to end each month with an inventory of direct materials equal to 30% of that months direct material requirements. Budgeted direct materials purchases for the third month would be:

1. 180,000 pounds
2. 89,400 pounds
3. 60,000 pounds
4. 170,800 pounds