Question

Exercise 7-2 Preparing Sales and Production Budgets (LO2 - CC5, 6) The marketing department of Jessi Corporation has submitted the following sales forecast for the upcoming fiscal year: Budgeted sales (units) 1st Quarter 8,100 2nd Quarter 10,100 3rd Quarter 12,100 4th Quarter 11,100 The selling price of the company's product is $21 per unit. Management expects to collect 55% of sales in the quarter in which the sales are made and 40% in the following quarter; 5% of sales are expected to be uncollectible. The beginning balance of accounts receivable, all of which are expected to be collected in the first quarter, is $81,500. The company expects to start the first quarter with 2,050 units in finished goods inventory. Management desires an ending finished goods inventory in each quarter equal to 15% of the next quarter's budgeted sales. The desired ending finished goods inventory for the fourth quarter is 2,300 units. Required: 1-a.Prepare the company's sales budget. JESSI CORPORATION Sales Budget 2nd Quarter 3rd Quarter $ 10,100 $ 12,100 1st Quarter $ 8,100 4th Quarter $ 11,100 Year 41,400 Total sales $

Answer 1

Requirement 1 Jessi Corporation Sales Budget Budgeted Unit sales Selling price per unit Total sales Requirement 2 Schedule of Cash flows 1 8100 $21 $1,70,100 2 10100 $21 $2,12,100 Quarter 3 12100 $21 $2,54,100 4 11100 $21 $2,33,100 Total 4 1400 $21 $8,69,400 Quarter 3 2 4 $ 1 81,500.00 $93,555 $68,040 $1,16,655 Accounts Receivable,Beginning Quarter 1 sales Quarter 2 sales Quarter 3 sales Quarter 4 sales Total Cash collections Requirement 3 $84,840 $1,39,755 Total $ 81,500.00 $ 1,61,595.00 $ 2,01,495.00 $ 2,00,739.00 $ 1,28,205.00 $ 7,73,534.00 $60,984 $1,28,205 $1,89, 189.00 $ 1,75,055.00 $ 1,84,695.00 $ 2,24,595.00 4 Budgeted Unit sales Add : Desired ending inventory Total Units needed Less : Beginning inventory Required Production Jessi Corporation Productionn Budget Quarter 12 3 8100 10100 1515 1815 9615 11915 2050 1515 7565 10400 12100 1665 13765 1815 11100 2300 13400 Total 41400 2300 43700 2050 41650 1665 11950 11735

Adv Chg March - Microsoft Excel - O X Home Insert Page Layout Formulas Data Review View fir 2 O 2 À @ Calculate Now Insert Function AutoSum Recently Financial Logical Text Date & Lookup & Math & - Used Time Reference - Trig Function Library More Functions a Define Name Use in Formula Name Manager Create from Selection Defined Names Trace Precedents 5 Show Formulas Trace Dependents Error Checking Watch Remove Arrows Evaluate Formula Window Formula Auditing Calculation Calculate Sheet Options Calculation B1 B TF H 1 Requirement1 Jessi Corporation Sales Budget Quarter ca Total 11 8100 11100 2 10100 =B7 =C6"C7 6 Budgeted Unit sales 7 Selling price per unit Total sales 9 Requirement 2 10 Schedule of Cash flows 12100 =C7 =D6D7 -07 =SUM(B6:E6) =E7 =F6"F7 =B6 B7 =F6" F7 Quarter 12 81500 -B8*55% Total - SUM(B13E13) -SUM(B14:14) =B8*40% =C8*55%. =C8'40% -08'55%. 13 Accounts Receivable Beginning 14 Quarter 1 sales 15 Quarter 2 sales 16 Quarter 3 sales 17 Quarter 4 sales 18 Total Cash collections 19 Requirement 3 20 =D8 24% -E8*55%. SUM(E 13:E17) = SUM(B16:E16) =SUM(B17:17) =SUM(F13:F17) - SUM(B13:B17) -SUM(C13:C17) =SUM(D13:017) Jessi Corporation Productionn Budget Quarter 24 Budgeted Unit sales 25 Add: Desired ending inventory 26 Total Units needed 27 Less: Beginning inventory 28 Required Production 29 8100 =C24'15%. =B24+B25 2050 =B26-B27 10100 =D24' 15%. =C24+C25 =B25 =C26-027 12100 =E2415%. =024+D25 =C25 =D26-027 11100 2300 =E24+E25 =D25 =E26-E27 Total = SUM(B24:E24) -E2S =F24+F25 =B27 =F26-F27 30 H Sheet140 Sheet141 Sheet142 Sheet144 Sheet366 Sheet577 Sheet360 Sheet1! H Ready 1 + Sheet138 Sheet139 Circular References Type here to search 0 + DO 70% ^ de la IX ENG 25 23:55