Forecast Sales Volume and Sales Budget Guardian Framing Inc. prepared the follow
ID: 2475081 • Letter: F
Question
Forecast Sales Volume and Sales Budget
Guardian Framing Inc. prepared the following sales budget for the current year:
At the end of December 2014, the following unit sales data were reported for the year:
For the year ending December 31, 2015, unit sales are expected to follow the patterns established during the year ending December 31, 2014. The unit selling price for the 8" × 10" frame is expected to increase to $18 and the unit selling price for the 12" × 16" frame is expected to increase to $29, effective January 1, 2015.
Required:
Hint(s)
1. Compute the increase or decrease of actual unit sales for the year ended December 31, 2014, over budget. Use the minus sign to indicate a decrease in amount and percent. Round percents to the nearest whole percent.
2. Assuming that the increase or decrease in actual sales to budget indicated in part (1) is to continue in 2015, compute the unit sales volume to be used for preparing the sales budget for the year ending December 31, 2015. Use the minus sign to indicate a decrease in percent. Round budgeted units to the nearest whole unit.
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To calculate the difference subtract actual sales from budget.
Learning Objective 4.
Hint(s)
3. Prepare a sales budget for the year ending December 31, 2015.
Guardian Framing Inc.
Sales Budget
For the Year Ending December 31, 2015
Product and Area
Unit Sales Volume
Unit Selling Price
Total Sales
8" × 10" Frame:
East
$
$
Central
West
Total
$
12" × 16" Frame:
East
$
$
Central
West
Total
$
Total revenue from sales
$
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Compare the budget and actual unit sales for both frames in each of the three areas.
Learning Objective 4.
Guardian Framing Inc.Sales Budget
For the Year Ending December 31, 2014 Product and Area Unit Sales
Volume Unit Selling
Price Total Sales 8" × 10" Frame: East 25,100 $17 $426,700 Central 6,800 17 115,600 West 6,300 17 107,100 Total 38,200 $649,400 12" × 16" Frame: East 14,200 $27 $383,400 Central 5,000 27 135,000 West 3,800 27 102,600 Total 23,000 $621,000 Total revenue from sales $1,270,400
Explanation / Answer
1.
2.
Budgeted sales Actual sales Increase / (Decrease) % 8" x 10" Frame 426,700 448,035 21,335 5% East 115,600 119,068 3,468 3% Central 107,100 103,887 -3,213 -3% West 12" x 16 " Frame East 383,400 406,404 23,004 6% Central 135,000 132,300 -2,700 -2% West 102,600 105,678 3,078 3%Related Questions
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