Answer
The Howell Company should purchase 162,000 gallons of direct materials during the 3 months ending March 31.
Work Step by Step
To calculate the number of gallons of direct materials that the Howell Company should purchase during the 3 months ending March 31, you can use the following formula:
Direct Materials to Be Purchased = (Direct Materials Required for Production + Target Ending Inventory) - Beginning Inventory
First, calculate the direct materials required for production:
Direct Materials Required for Production = (Expected Production * Gallons per Unit) = (43,000 units $\times$ 4 gallons per unit) = 172,000 gallons
Now, use the formula to find the direct materials to be purchased:
Direct Materials to Be Purchased = (172,000 gallons + 56,000 gallons) - 66,000 gallons = 162,000 gallons
So, the Howell Company should purchase 162,000 gallons of direct materials during the 3 months ending March 31.
