Reference no: EM132507347

Ramos Co. provides the following sales forecast and production budget for the next four months.

                                           April            May         June            July
Sales (units)                          550               630       580          650
Budgeted production (units)      490           620           590           590

Point 1: The company plans for finished goods inventory of 170 units at the end of June. In addition, each finished unit requires 6 pounds of direct materials and the company wants to end each month with direct materials inventory equal to 25% of next month's production needs. Beginning direct materials inventory for April was 735 pounds. Direct materials cost $3 per pound. Each ?nished unit requires 0.60 hours of direct labor at the rate of $21 per hour. The company budgets variable overhead at the rate of $25 per direct labor hour and budgets fixed overhead of $8,500 per month. 

Question 1: Prepare a direct materials budget for April, May, and June