Answer:
Sales budget $ for the 4 quarters is $ 600,000 $ 720,000 $594000 and $ 825,000
Production Budget in units for the four quarters i s 7997.6 9000 8900 and 10,350 units
Step-by-step explanation:
Sales Budget
Quarters I II III IV
Sales Volume 8000 9600 7200 10,000
<u>Sales Price $75.00 $75.00 $ 82.50 $82.50 </u>
<u>Sales $ 600,000 720,000 594000 825,000 </u>
We calculate the sales volume by applying the given percent to the sales units for each quarter. Then multiply it with the sales price to get the sales budget.
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Production Budget
Quarters I II III IV
Sales Volume 8000 9600 7200 10,000
+ Desired
Ending Inv. 2400 1800 3500 3850
<u>Less Opening ----- 2400 1800 3500 </u>
<u>Production 7997.6 9000 8900 10,350 </u>
We find the production budget units by adding the desired ending inventory and subtracting the opening inventory from the sales units calculated above. The ending inventory of one quarter is the opening inventory of the next quarter.As we do not know the ending inventory of the previous year we cannot find the opening inventory of the 1st quarter of the year .
