Sales and Production Budgets Berring Company produces two products: the deluxe a

Question

Sales and Production Budgets Berring Company produces two products: the deluxe and the standard. The deluxe sells for $40, and the standard sells for $10. Projected sales of the two models for the coming four quarters are given below. Deluxe Standard 12,000 90,000 14,300 16,600 92,000 20,000 First quarter Second quarter Third quarter Fourth quarter The president of the company belleves that the projected sales are realistic and can be achieved by the company. In the factory, the production supervisor has recelved the projected sales figures and gathered information needed to complle production budgets. He found that 1,300 deluxes and 1,170 standards were in inventory on January 1. Company policy dictates that ending inventory should equal 20 percent of the next quarter's sales for deluxes and 10 percent of next quarter's sales for standards. 88,400 91,600

Explanation / Answer

Solution 1:

Solution 2:

Berring Company Sales Budget For the year ended December 31 Particulars Quarter 1 Quarter 2 Quarter 3 Quarter 4 Year Deluxe: Sales Units 12000 14300 16600 20000 62900 Unit Price $40.00 $40.00 $40.00 $40.00 $40.00 Sales $480,000.00 $572,000.00 $664,000.00 $800,000.00 $2,516,000.00 Standard: Sales Units 90000 88400 92000 91600 362000 Unit Price $10.00 $10.00 $10.00 $10.00 $10.00 Sales $900,000.00 $884,000.00 $920,000.00 $916,000.00 $3,620,000.00

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