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E9-5 Dallas Industries has adopted

Price: $1.99


Dallas Industries has adopted the following production budget for the first 4 months
of 2014.


Month  Units  Month  Units 
January  10,000 March  5,000
February  8,000 April  4,000

Each unit requires 2 pounds of raw materials costing $2 per pound. On December 31,
2013, the ending raw materials inventory was 4,000 pounds. Management wants to have a
raw materials inventory at the end of the month equal to 20% of next month’s production
requirements.

Instructions
Prepare a direct materials purchases budget by month for the first quarter.

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