Two grams of musk oil are required for each bottle of Mink

Caress, a very popular perfume made by a small company in western

Siberia. The cost of the musk oil is $1.70 per gram. Budgeted

production of Mink Caress is given below by quarters for Year 2 and

for the first quarter of Year 3:

Year 2

Year 3

in bottles

    Musk oil has become so popular as a

perfume ingredient that it has become necessary to carry large

inventories as a precaution against stock-outs. For this reason,

the inventory of musk oil at the end of a quarter must be equal to

30% of the following quarterAc??cs production needs. Some 46,800 grams

of musk oil will be on hand to start the first quarter of Year

2.

Prepare a direct materials budget for musk oil, by quarter and

in total, for Year 2. (Round "Unit cost of raw materials"

answers to 2 decimal places.)

Budget - Year 2QuarterFirstSecondThirdFourthYearRequired production

in units of finished goods156,000216,000336,000236,000944,000Units

of raw materials needed per unit of finished goodsUnits of raw

materials needed to meet productionAdd: Desired units of ending raw

materials inventory64,800100,80070,80026,400262,800Total units of

raw materials needed64,800100,80070,80026,400262,800Less: Units of

beginning raw materials inventoryUnits of raw materials to be

purchased64,800100,80070,80026,400262,800Unit cost of raw

materialsCost of raw materials to purchased