Two grams of musk oil are required for each bottle of Mink Caress, a very popular perfume made by a small company in western Siberia. The cost of the musk oil is $1.70 per gram. Budgeted production of Mink Caress is given below by quarters for Year 2 and for the first quarter of Year 3:

	Year 2				Year 3
	First	Second	Third	Fourth	First
Budgeted production, in bottles	78,000	108,000	168,000	118,000	88,000

The inventory of musk oil at the end of a quarter must be equal to 20% of the following quarters production needs. Some 31,200 grams of musk oil will be on hand to start the first quarter of Year 2.

Required:Prepare a direct materials budget for musk oil, by quarter and in total, for Year 2.

X Answer is complete but not entirely corr Mink Caress Direct Materials Budget - Year 2 Quarter First Second Third 168,000 2 336,000 Required production in units of finished goods Units of raw materials needed per unit of finished goods Units of raw materials needed to meet production Add: Desired units of ending raw materials inventory Total units of raw materials needed Less: Units of beginning raw materials inventory Units of raw materials to be purchased Unit cost of raw materials Cost of raw materials to purchased $ $ 78,000 2 156,000 64,800 X 220,800 X 46,800 X 176,000 X 1.70 $ 299,200 $ 108,000 2 216,000 100,800 70,800 X 316,800 406,800 X 64,800 100,800 X 248,000 X 324,000 X 1.70 $ 1.70 421,600 $ 550,800 cer $ $ Third 168,000 2 336,000 70,800 X 406,800 X 100,800 X 324,000 X 1.70 $ 550,800 $ Fourth 118,000 2 236,000 52,800 X 288,800 X 70,800 X 232,000 X 1.70 394,400 Year 472,000 2 944,000 52,800 X 996,800 X 46,800 X 980,000 X $ 1.70 $ 1,666,000