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Production and materials budget. Cagayan Corporation manufactures and distributes a number of products to retailers. One of the products, Dalton requires four pounds of material X in the manufacture of each unit. The company is now planning raw materials need for second quarter. Peak sales of Dalton occur in the second quarter of each year. To keep production and shipments moving smoothly, the company has the following inventory requirements.

a.Finished goods. The finished good inventory on hand at the end of each month must be equal to 6,000 units, plus 20% of the next month's sales. The finished goods inventory on March 31 is budgeted to be 14,000.

b.Raw materials. The raw materials inventory on hand at the end of each month must be equal to one-fourth of the following month's production needs for raw materials. The raw materials inventory on March 31 for material X is budgeted to be 60,000 pounds.

c.Work in process. The company maintains no work in process inventories

A sales budget for Dalton for the six months at the middle of the year is shown below

Month Units Month Units

March 80,000 June 45,000

April 90,000 July 30,000

May 98,000 August 40,000

Required:

1.Production budget for the second quarter, per month andin total.

2.Direct Materials budget for the second quarter, per month and in total

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