Orr Company makes and sells a single product called a Bik. It takes three yards of Material A to make one Bik. Budgeted production of Biks for the...

Orr Company makes and sells a single product called a Bik. It takes three yards of Material A tomake one Bik. Budgeted production of Biks for the next three months is as follows:Budgted Biks to be Produced15,000 units18,500 units17,200 unitsThe company wants to maintain monthly ending inventories of Material A equal to 25% of the nextmonth's production needs. The cost of material A is $1.20 per yard. The company is in the processof preparing a direct materials purchases budget.