Pablo Company Has Budgeted Production for Next Year as Follows

Pablo Company has budgeted production for next year as follows:
$$\begin{array} { | l | r | r | r | r | } \hline && { \text { Quarter } } \\\hline & \text { First } & \text { Second } & \text { Third } & \text { Fourth } \\\hline \text { Production in urits } & 60,000 & 80,000 & 90,000 & 70,000 \\\hline\end{array}$$
Two pounds of material A are required for each unit produced. The company has a policy of maintaining a stock of material A on hand at the end of each quarter equal to 25% of the next quarter's production needs for material A. A total of 30,000 pounds of material A are on hand to start the year. Budgeted purchases of material A for the second quarter would be:

A) 82,500 pounds.
B) 165,000 pounds.
C) 200,000 pounds.
D) 205,000 pounds.

Correct Answer:

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