Question

Forecast Sales Volume and Sales Budget

For 20Y8, Raphael Frame Company prepared the sales budget that follows.

At the end of December 20Y8, the following unit sales data were reported for the year:

	Unit Sales
	8" × 10" Frame		12" × 16" Frame
East	32,548		9,152
Central	8,585		2,254
West	7,663		1,632

Raphael Frame Company Sales Budget For the Year Ending December 31, 20Y8
Product and Area		Unit Sales Volume		Unit Selling Price		Total Sales
8" × 10" Frame:
East		31,600		$16		$505,600
Central		8,500		16		136,000
West		7,900		16		126,400
Total		48,000				$768,000
12" × 16" Frame:
East		8,800		$26		$228,800
Central		2,300		26		59,800
West		1,600		26		41,600
Total		12,700				$330,200
Total revenue from sales						$1,098,200

For the year ending December 31, 20Y9, unit sales are expected to follow the patterns established during the year ending December 31, 20Y8. The unit selling price for the 8" × 10" frame is expected to increase to $17 and the unit selling price for the 12" × 16" frame is expected to increase to $28, effective January 1, 20Y9.

Required:

1. Compute the increase or decrease of actual unit sales for the year ended December 31, 20Y8, over budget. Use the minus sign to indicate a decrease in amount and percent. Round percents to the nearest whole percent.

		Unit Sales, Year Ended 20Y8				Increase (Decrease) Actual Over Budget
		Budget		Actual Sales		Amount	Percent
8" × 10" Frame:
	East						%
	Central						%
	West						%
12" × 16" Frame:
	East						%
	Central						%
	West						%

Answer 1

Compute the increase/decrease in actual unit sales as follows:

	Unit Sales, Year Ended 20Y8		Increase (Decrease) Actual Over Budget
	Budget	Actual Sales	Amount	Percent
	A	B	B-A = C	C/A
8" × 10" Frame:
East	31600	32548	948	3%
Central	8500	8585	85	1%
West	7900	7663	-237	-3%
12" × 16" Frame:
East	8800	9152	352	4%
Central	2300	2254	-46	-2%
West	1600	1632	32	2%