Langer Company produces plastic items, including plastic housings for humidiﬁers. Each housingrequires about 15 ounces of plastic costing $0.08 per ounce. Langer molds the plastic into the propershape. Langer has budgeted production of the housings for the next four months as follows:
May 220,000June ……200,000
Inventory policy requires that sufﬁcient plastic be in ending monthly inventory to satisfy 20% of the following month’s production needs. The inventory of plastic at the beginning of July equalsexactly the amount needed to satisfy the inventory policy.
Prepare a direct materials purchases budget for July, August, and September, showing purchasesin units and in dollars for each month and in total.
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