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Date Submitted: 09/14/2012 01:04 PM
Master Budget Exercises
Timothy Vallin
BUS 630 Managerial Accounting
Instructor: Mark Taylor
June 17, 2012
Sales and Production Budgets (8-12): 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 |
Units to be produced | 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.
* Prepare the company's sales budget and schedule of expected cash collections.
* Prepare the company's production budget for the upcoming fiscal year.
Jessi Corp. Sales Budget
| 1 | 2 | 3 | 4 | Total |
Budgeted Unit Sales | 11,000 | 12,000 | 14,000 | 13,000 | 50,000 |
Selling Price per Unit | X18 | X18 | X18 | X18 | X18 |
Total Sales | 198,000 | 216,000 | 252,000 | 234,000 | 900,000 |
Schedule of Collections Per Quarter
Acct Rec. Beg | 70,200 | | | | 70,200 |
Quarter 1 | 128,700 | 59,400 | | | 188,100 |
Quarter 2 | | 140,400 | 64,800 | | 205,200 |
Quarter 3 | | | 163,800 | 70,200 | 234,000 |
Quarter 4 | | | | 152,100 | 152,100 |
Total Collected | 198,900 | 199,800 | 228,600 | 222,300 | 849,600 |
Jessi Corp. Production Budget
Budgeted Unit Sales | 11,000 | 12,000 | 14,000 | 13,000 | 50,000 |
Desired Ending Inventory | +1,800 | +2100 | +1,950 | +1,850 |...