The marketing department of Jessi Corporation has submitted the following sales forecast for the upcoming nscal year (ail sales are on account): 1st Quarter 2nd Quarter 3rd Quarter 4th Quarter Budgeted unit sales......... 11,000 12,000 14,000 13,000 The selling price of the company's product is $18.00 per unit. Management expects to collect 65% of sales in the quarter in which the sales are made the following quarter, and 5% of sales are expected to be uncollectible. The beginning balance of accounts receivable, all of which is expected to be e the first quarter, is $70,200. The company expects to start the first quarter with 1,650 units in finished goods inventory. Management desires an ending finished goods inventory quarter equal to 15% of the next quarter's budgeted sales. The desired ending finished goods inventory for the fourth quarter is 1,850 units.
The marketing department of Jessi Corporation has submitted the following sales forecast for the upcoming nscal year (ail sales are on account): 1st Quarter 2nd Quarter 3rd Quarter 4th Quarter Budgeted unit sales......... 11,000 12,000 14,000 13,000 The selling price of the company's product is $18.00 per unit. Management expects to collect 65% of sales in the quarter in which the sales are made the following quarter, and 5% of sales are expected to be uncollectible. The beginning balance of accounts receivable, all of which is expected to be e the first quarter, is $70,200. The company expects to start the first quarter with 1,650 units in finished goods inventory. Management desires an ending finished goods inventory quarter equal to 15% of the next quarter's budgeted sales. The desired ending finished goods inventory for the fourth quarter is 1,850 units.
Financial & Managerial Accounting
14th Edition
ISBN:9781337119207
Author:Carl Warren, James M. Reeve, Jonathan Duchac
Publisher:Carl Warren, James M. Reeve, Jonathan Duchac
Chapter21: Budgeting
Section: Chapter Questions
Problem 21.1APR: Forecast sates volume and sales budget For 20Y8, Raphael Frame Company prepared the sales budget...
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Concept explainers
Master Budget
A master budget can be defined as an estimation of the revenue earned or expenses incurred over a specified period of time in the future and it is generally prepared on a periodic basis which can be either monthly, quarterly, half-yearly, or annually. It helps a business, an organization, or even an individual to manage the money effectively. A budget also helps in monitoring the performance of the people in the organization and helps in better decision-making.
Sales Budget and Selling
A budget is a financial plan designed by an undertaking for a definite period in future which acts as a major contributor towards enhancing the financial success of the business undertaking. The budget generally takes into account both current and future income and expenses.
Question
![EXERCISE 8-14 Sales and Production Budgets [ LO8-2, Q LO8-3]
The marketing department of Jessi Corporation has submitted the following sales forecast for the upcoming fiscal year (all sales are on account):
1st Quarter 2nd Quarter 3rd Quarter 4th Quarter
Budgeted unit sales....
11,000
12,000
14,000
13,000
The selling price of the company's product is $18.00 per unit. Management expects to collect 65% of sales in the quarter in which the sales are made, 30% in
the following quarter, and 5% of sales are expected to be uncollectible. The beginning balance of accounts receivable, all of which is expected to be collected in
the first quarter, is $70,200.
The company expects to start the first quarter with 1,650 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 1,850 units.
Required:
1. Prepare the company's sales budget and schedule of expected cash collections for each quarter and the year.
2. Prepare the company's production budget for the upcoming fiscal year (by quarter).
werk](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F55ae0517-2d99-4ebe-b3e4-a5c853a4cfd4%2F7f1cebdb-fe7c-4b8c-bc92-4b3d3b1a0488%2Fyk9wxyx_processed.jpeg&w=3840&q=75)
Transcribed Image Text:EXERCISE 8-14 Sales and Production Budgets [ LO8-2, Q LO8-3]
The marketing department of Jessi Corporation has submitted the following sales forecast for the upcoming fiscal year (all sales are on account):
1st Quarter 2nd Quarter 3rd Quarter 4th Quarter
Budgeted unit sales....
11,000
12,000
14,000
13,000
The selling price of the company's product is $18.00 per unit. Management expects to collect 65% of sales in the quarter in which the sales are made, 30% in
the following quarter, and 5% of sales are expected to be uncollectible. The beginning balance of accounts receivable, all of which is expected to be collected in
the first quarter, is $70,200.
The company expects to start the first quarter with 1,650 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 1,850 units.
Required:
1. Prepare the company's sales budget and schedule of expected cash collections for each quarter and the year.
2. Prepare the company's production budget for the upcoming fiscal year (by quarter).
werk
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