REVEL for Horngren's Cost Accounting: A Managerial Emphasis -- Access Card (16th Edition) (What's New in Accounting)
16th Edition
ISBN: 9780134789705
Author: Srikant M. Datar, Madhav V. Rajan
Publisher: PEARSON
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Chapter 6, Problem 6.26E
Revenues and production budget. Saphire, Inc., bottles and distributes mineral water from the company’s natural springs in northern Oregon. Saphire markets two products: 12-ounce disposable plastic bottles and 1-gallon reusable plastic containers.
- 1. For 2018, Saphire marketing managers project monthly sales of 500,000 12-ounce bottles and 130,000 1-gallon containers. Average selling prices are estimated at $0.30 per 12-ounce bottle and $1.60 per 1-gallon container. Prepare a revenues budget for Saphire, Inc., for the year ending December 31, 2018.
Required
- 2. Saphire begins 2018 with 980,000 12-ounce bottles in inventory. The vice president of operations requests that 12-ounce bottles ending inventory on December 31, 2018, be no less than 660,000 bottles. Based on sales projections as budgeted previously, what is the minimum number of 12-ounce bottles Saphire must produce during 2018?
- 3. The VP of operations requests that ending inventory of 1-gallon containers on December 31, 2018, be 300,000 units. If the production budget calls for Saphire to produce 1,200,000 1-gallon containers during 2018, what is the beginning inventory of 1-gallon containers on January 1, 2018?
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Saphire, Inc., bottles and distributes mineral water from the company’s natural springs in northern Oregon. Saphire markets two products: 12-ounce disposable plastic bottles and 1-gallon reusable plastic containers.
Q1. For 2018, Saphire marketing managers project monthly sales of 500,000 12-ounce bottles and 130,000 1-gallon containers. Average selling prices are estimated at $0.30 per 12-ounce bottle and $1.60 per 1-gallon container. Prepare a revenues budget for Saphire, Inc., for the year ending December 31, 2018.
Stone Canyon Muffins sells its muffins to restaurants and coffee houses for an average selling price of $27 per case. The following information relates to the budget for Stone Canyon Muffins for this year (all figures are annual totals unless otherwise noted):
Budget information:
Budgeted sales in cases. . . . . .
9,300 cases
Packaging cost per case. . . . . .
$4
Shipping expense per case. . . .
$2
Sales commission expense. . . .
1% of sales price
Salaries expense. . . . . . . . . . . .
$7,000
Office rent. . . . . . . . . . . . . . . . .
$3,800
Depreciation. . . . . . . . . . . . . . .
$2,600
Insurance expense. . . . . . . . . .
$2,500
Office supplies expense. . . . . .
$600
Actual expenses:
Packaging cost. . . . . . . . . . . . . .
$39,300
Shipping expense. . . . . . . . . . . .
$21,800
Sales commission expense. . . . .
$2,641
Salaries expense. . . . . . . . . . . . .
$8,500
Office rent.…
Springton makes and sells a single product, black handbags, at a price of $1,600 each. During the three months to December 31,2020, he sold 1,500 handbags and turnover was the same for each month.
He expects the volume of sales to remain unchanged for January 2021 but to increase by 5% in February, and by a further 20% in April. The price of the handbags will be increased by 10% in January and by a further 5% in June.
The following budgeted information is presented to assist in the preparation.
Month
Budgeted sales
$
Budgeted purchases
$
January
880,000
600,000
February
924,000
750,000
March
924,000
820,000
April
1,108,800
820,000
May
1,250,000
968,000
June
1,285,000
1,250,000
Notes:
Effective January 1, 2021 Springton’s collection on sales will be as follows:
70% collected in the month of sale
The balance will be collected one month following sale
Required:
Prepare a sales budget for the handbags…
Chapter 6 Solutions
REVEL for Horngren's Cost Accounting: A Managerial Emphasis -- Access Card (16th Edition) (What's New in Accounting)
Ch. 6 - What are the four elements of the budgeting cycle?Ch. 6 - Define master budget.Ch. 6 - Strategy, plans, and budgets are unrelated to ore...Ch. 6 - Budgeted performance is a better criterion than...Ch. 6 - Production managers and marketing managers are...Ch. 6 - Budgets meet the cost-benefit test. They force...Ch. 6 - Define rolling budget. Give an example.Ch. 6 - Outline the steps in preparing an operating...Ch. 6 - The sales forecast is the cornerstone for...Ch. 6 - Prob. 6.10Q
Ch. 6 - Define Kaizen budgeting.Ch. 6 - Prob. 6.12QCh. 6 - Explain how the choice of the type of...Ch. 6 - What are some additional considerations that arise...Ch. 6 - Prob. 6.15QCh. 6 - Master budget. Which of the following statements...Ch. 6 - Operating and financial budgets. Which of the...Ch. 6 - Production budget. Superior Industries sales...Ch. 6 - Responsibility centers. Elmhurst Corporation is...Ch. 6 - Cash budget. Mary Jacobs, the controller of the...Ch. 6 - Sales budget, service setting. In 2017 Hart Sons,...Ch. 6 - Sales and production budget. The Coby Company...Ch. 6 - Direct material budget. Dawson Co. produces wine....Ch. 6 - Material purchases budget. The McGrath Company has...Ch. 6 - Revenues, production, and purchases budgets. The...Ch. 6 - Revenues and production budget. Saphire, Inc.,...Ch. 6 - Budgeting; direct material usage, manufacturing...Ch. 6 - Budgeting, service company. Ever Clean Company...Ch. 6 - Budgets for production and direct manufacturing...Ch. 6 - Activity-based budgeting. The Jerico store of...Ch. 6 - Kaizen approach to activity-based budgeting...Ch. 6 - Responsibility and controllability. Consider each...Ch. 6 - Responsibility, controllability, and stretch...Ch. 6 - Cash flow analysis, sensitivity analysis....Ch. 6 - Budget schedules for a manufacturer. Hale...Ch. 6 - Budgeted costs, Kaizen improvements environmental...Ch. 6 - Revenue and production budgets. (CPA, adapted) The...Ch. 6 - Budgeted income statement. (CMA, adapted) Smart...Ch. 6 - Prob. 6.39PCh. 6 - Comprehensive problem with ABC costing. Animal...Ch. 6 - Cash budget (continuation of 6-40). Refer to the...Ch. 6 - Comprehensive operating budget. Skulas, Inc.,...Ch. 6 - Cash budgeting, budgeted balance sheet....Ch. 6 - Comprehensive problem; ABC manufacturing, two...Ch. 6 - Cash budget. (Continuation of 6-44) (Appendix)...Ch. 6 - Budgeting and ethics. Jayzee Company manufactures...Ch. 6 - Kaizen budgeting for carbon emissions. Apex...Ch. 6 - Comprehensive budgeting problem; activity-based...
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