The Bakery at the Lake produces organic bread that is sold by the loaf. Each loaf requires 1/2 of a pound of flour. The bakery pays $3.50 per pound of the organic flour used in its loaves. The bakery expects to produce the following number of loaves in each of the upcoming four months:

July. . . . . . . . . . . . . . . . . . .

1,540 loaves

August. . . . . . . . . . . . . . . .

1,900 loaves

September. . . . . . . . . . . . .

1,700 loaves

October. . . . . . . . . . . . . . . .

1,540 loaves

The bakery has a policy that it will have 20% of the following month's flour needs on hand at the end of each month. At the end of June, there were

154 pounds of flour on hand. Prepare the direct materials budget for the third quarter, with a column for each month and for the quarter.

Begin the direct materials budget by determining the total quantity needed, then complete the budget. (Enter the pounds per unit as a decimal to two places. Round your calculations to the nearest whole number.)

The Bakery at the Lake

Direct Materials Budget

For the Months of July through September

July

August

September

Quarter

The Bakery at the Lake
Direct Materials Budget
For the Months of July through September
	July	August	September	Quarter
Units to be produced	1540	1900	1700	5140
Multiply by: Pounds of flour needed per unit Quantity needed (lbs) for production Plus: Desired ending inventory of direct materials Total quantity (lbs) needed