The marketing department of Jessi Corporation has submitted the following sales forecast for the upcoming fiscal year: 1st 2nd 3rd 4th Quarter 9,600 Quarter 11,600 Quarter 13,600 Quarter 12,600 Budgeted sales (units) The selling price of the company's product is $36 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 $96,500. The company expects to start the first quarter with 2,800 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 3,050 units.
The marketing department of Jessi Corporation has submitted the following sales forecast for the upcoming fiscal year: 1st 2nd 3rd 4th Quarter 9,600 Quarter 11,600 Quarter 13,600 Quarter 12,600 Budgeted sales (units) The selling price of the company's product is $36 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 $96,500. The company expects to start the first quarter with 2,800 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 3,050 units.
Principles of Cost Accounting
17th Edition
ISBN:9781305087408
Author:Edward J. Vanderbeck, Maria R. Mitchell
Publisher:Edward J. Vanderbeck, Maria R. Mitchell
Chapter7: The Master Budget And Flexible Budgeting
Section: Chapter Questions
Problem 1E: The sales department of Macro Manufacturing Co. has forecast sales for its single product to be...
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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
Prepare the company's production budget for the upcoming year
No need of preparing sales budget
Transcribed Image Text:The marketing department of Jessi Corporation has submitted the following sales forecast for the upcoming fiscal year:
1st
2nd
3rd
4th
Quarter
9,600
Quarter
Quarter
Quarter
12,600
Budgeted sales (units)
11,600
13,600
The selling price of the company's product is $36 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 $96,500.
The company expects to start the first quarter with 2,800 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 3,050 units.
Required:
1-a. Prepare the company's sales budget.
JESSI CORPORATION
Sales Budget
1st Quarter
2nd Quarter
3rd Quarter
4th Quarter
Year
Total sales
Transcribed Image Text:2. Prepare the company's production budget for the upcoming fiscal year.
JESSI CORPORATION
Production Budget
1st Quarter
2nd Quarter
3rd Quarter
4th Quarter
Year
Total units needed
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