Green River company is preparing its master budget for 2012. Relevant data perta

Question

Green River company is preparing its master budget for 2012. Relevant data pertaining to its sales, production , and direct material budget as follows. Sales : sales for the year are expected to total 1,440,000 units. Quarterly sales 10%, 20% , and 50% , respecvtively. the sales price is expected to be $50 per unit for the first three quarters and $46 per unit beginning in the fourth Quarter. Sales in the first quarter of 2013 are expected to be 20% higher than the budgeted sales for the first quarter of 2012. Production : Mangement desires to maintain the ending finshed goods inventories at 30% of the next quarter's budgeted sales volume. Direct materials : Each unit requires 2 pounds of raw materials at a cost of $9 per pounds of raw materials at a cost $9 per pound. Management desires to raw materials inventories at 10% of the next quarter's production requirements. Assume the production requirements for first quarter of 2013 are 456,100 pounds. Prepare the sales budget by quarters for 2012.

Explanation / Answer

Note : Total Expected Sales for the year 2012 = 1440000

Quarter 1= 1440000 * 10% =144000

Quarter 2 = 1440000*20% =288000

Quarter 3 = 1440000*20% = 288000

Quarter 4 = 1440000*50%= 720000

Green River Company Sales Budget For the year Ending December 31,2012 Quarter 1 2 3 4 Sales Budget (in Quantity ) 144000 288000 288000 720000 Sellng Price per unit $50 $50 $50 $46 Sales Budget (in $) $7,200,000 $14,400,000 $14,400,000 $33,120,000

Related Questions

Navigate

• Browse (All)
• Browse G
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.