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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.

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

Musk oil has become so popular as a perfume ingredient that it has become necessary to carry large inventories as a precaution against stock-outs. For this reason, the inventory of musk oil at the end of a quarter must be equal to 30% of the following quarter

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