Prester Corporation Has Budgeted Production for Next Year as Follows

Multiple Choice

Prester Corporation has budgeted production for next year as follows: 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) 145,000 pounds
B) 140,000 pounds
C) 180,000 pounds
D) 135,000 pounds