The marketing department of Jessi Corporation has submitted the following sales

Question

The marketing department of Jessi Corporation has submitted the following sales forecast for the upcoming fiscal year (all sales are on account) Budgeted unit sales 11,960 14,968 13,908 The selling price of the company's product S18 per unit Management expects to collect 75% of sales in the quarter n which the sales are made. 20% 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 $72,000. The company expects to start the first quarter with 1785 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 mentory for the fourth quarter is 1,985 units Required: 1. Calculate the estimated sales for each quarter of the fiscal year and for the year as a whole 2. Calculate the expected cash collections for each quarter of the fiscal year and for the year as a whole 3. Calculate the required production in units of finished goods for each quarter of the fiscal year and for the year as a whole Complete this question by entering your answers in the tabs below Required 1 Required 2 Required 3 Calculate the estimated sales for each quarter of the fiscal year and for the year as a Quarter Total sales Required 2 >

Explanation / Answer

Sales Budget 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr year Budgeted units sales 11,900 12,900 14,900 13,900 53,600 Selling price per unit 18 18 18 18 18 Total sales 214200 232200 268200 250200 964800 Schedule of Expected Cash collection 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr year Beginning accounts receivable 72,000 72,000 1st Qtr sale 160650 42840 203490 2nd Qtr sale 174150 46440 220590 3rd Qtr sale 201150 53640 254790 4th Qtr sale 187650 187650 Total cash collection 232,650 216990 247590 241290 938,520 Production Budget 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr year budgeted unit sales 11,900 12,900 14,900 13,900 53,600 Add Ending invnetory 1935 2235 2085 1,985 1,985 total needs 13,835 15,135 16,985 15,885 55,585 less opening inventory -1785 -1,935 -2,235 -2,085 -1,785 Required production in units 12,050 13,200 14,750 13,800 53,800

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