Brief 4 Dejan Lazaroski

1873 Words Feb 23rd, 2015 8 Pages
To: Professor Debra Petrizzo
From: Dejan Lazaroski
Subject: Problem 12-36
Date: 09/28/2014

Business Brief

Tyva produces popular undyed cloth sandals in Regular and Deluxe style. The company is preparing its budget for June 2013, based on past experience sales. The company sells Regular sandals for $120 and Deluxe for $195 collecting 60% of the revenues in the month of sales and 38% the following month.

Analysis

The budgeted collections accounts receivable from May and June are $802,800. The company collects the sales on account, 60% the first month and 38% the next month. In this situation, substantial amount of cash inflow is receivable, compared with the rate of 80% that are Accounts payable in the first month for materials
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The Cash Outflow that will come from the materials purchased. The finished goods inventory for June also is budgeted from 650 to 600 on the Deluxe and from 250 to 400 units of the Regular.

Some important assumptions I am using in my thinking are…
(Figure out what you are taking for granted. Make sure these assumptions are reasonable. Watch out for self – serving or unjustified assumptions.)
Significant account changes are expected from May’s Actual and June’s budgeted. Retained earnings would be increased in June compared with May.

The points of view relevant to this problem belong to…
(Who are your stakeholders? Determine whether the stakeholder’s point of view is relevant.)
How the products sales mix will influence on the budgeted net income. The gross profit margin per unit is higher of the Deluxe model.

Note: Remember to view the information you have obtained for potential bias. This is from the perspective of your own bias to the research and the bias of the authors who compiled the data and the research you gathered. In other words, do not discount the importance of other’s data because of your own bias(is).
Step 3: Make predictions about the future.
If this problem gets solved, some important implications are…
(Evaluate options, taking into account the advantages and disadvantages of possible decisions before

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