Olive Co. projects that it will use 10,000 liters of olive oil in the production process. Management estimates that 2,000 liters will be in the beginning materials inventory. Based on management’s analysis, the required ending materials inventory is estimated to be 1,000 liters of olive oil. There is no beginning or ending work-in-process inventory. The price for 1 liter of olive oil is $2. Which of the following is the budgeted cost of olive oil to be reported in the Direct Materials Budget?
$26,000
$14,000
$22,000
$18,000