Red Canyon T-shirt Company operates a chain of T-shirt shops in the southwestern

Question

Red Canyon T-shirt Company operates a chain of T-shirt shops in the southwestern United States. The sales manager has provided a sales forecast for the coming year, along with the following information Budgeted Unit Sales 42,000 64,000 32,000 54,000 . Each T-shirt is expected to sell tor 517 The purchasing manager buys the T-shirts for $7 each. The company needs to have enough T-shirts on hand at the end of each quarter to fil 27 percent of the next quarter's sales demand . Selling and administrative expenses are budgeted at 584,000 per quarter plus 14 percent of total sales revenue 1. Determine budgeted sales revenue for each quater. Budgeted Sales Revenue 71400o 1,088,0DD 544,000 2. Determine budgeted cost of merchandise purchased for each quarter Quarter 1 Quarter Budgeted Cost of Merchandise Purchased 3. Determine budgeted cost or good sold for each quarter Quarter 1 Quarter 2 Quarter 3 Budgeted Cost of Goods Sold 4. Delermine selling and administralive expenses for each quarter Quarter 1 Quarter 2 Quarter Budgeted Selling and Administrative Expenses

Explanation / Answer

1.

2.

3.

4.

Quarter 1 Quarter 2 Quarter 3 Budgeted sales revenue 42,000 x $17 = $714,000 64,000 x $17 = $1,088,000 32,000 x $17 = $544,000

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