You are provided with the following information for Keon Company.You are asked to assist in the budget-setting process.

Production budget for January, February and 2,000 units per month March Production budget for April, May and June 1,800 units per month (and July) Production standard - direct material 4.5 kilograms per unit Direct material inventory standard - percentage 70% DM required for current of closing inventory to next month's production month Direct material standard cost $25.00 per kilogram Direct material purchase paid in month of 40% of total purchase amount purchase Direct material purchase paid in following month 60% of total purchase amount Direct material purchases in December 8,000 kilograms Expected 31 December inventory 10,000 kilograms