Purpose a direct materials budget for the seasoning

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Reference no: EM1311075

Direct materials budget for the seasoning.

One quarter gram of a rare seasoning is required for each bottle of Dipping Oil, a very popular product sold through gourmet shops that is produced by the Lucas Company. The cost of the seasoning is $16 per gram. Budgeted production of Dipping Oil is given below for the second quarter, and the first month of the third quarter.

	April	May	June	July
Required production bottles	5000	8,000	15,000	10,000

The seasoning is so difficult to get that the company must have on hand at the end of each month 20% of the next month's production needs. A total of 250 grams will be on hand at the beginning of April.

Prepare a direct materials budget for the seasoning, by month an in total for the second quarter. Be sure to include both the quantity to be purchased and its cost for each month.

Reference no: EM1311075

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