Chapter 20, Problem 4E

To determine

Direct material budget:

A direct material budget can be defined as a budget that represents the quantity of materials required to be purchased to satisfy the production requirements. It also includes the price of the materials required to be purchased.

The formula used for the purpose is given below.

$\text{Direct material budget}=\left(\begin{array}{l}\text{Raw material for production}+\text{Ending raw }\\ \text{material}-\text{Opening}\text{raw material}\end{array}\right)$

To prepare: A direct materials budget for the months of April, May, and June.