Jasper Fruits Corporation wholesales peaches and oranges. Barbara Jasper is work

Question

Jasper Fruits Corporation wholesales peaches and oranges. Barbara Jasper is working with the company’s accountant to prepare next year’s budget. Ms. Jasper estimates that sales will increase 3 percent for peaches and 8 percent for oranges. The current year’s sales revenue data follow:

Based on the company’s past experience, cost of goods sold is usually 70 percent of sales revenue. Company policy is to keep 20 percent of the next period’s estimated cost of goods sold as the current period’s ending inventory. (Hint: Use the cost of goods sold for the first quarter to determine the beginning inventory for the first quarter.)

Required

a. Prepare the company’s sales budget for the next year for each quarter by individual product.

b. If the selling and administrative expenses are estimated to be $680,000, prepare the company’s budgeted annual income statement.

c. Ms.Jasper estimates next year’s ending inventory will be $35,900 for peaches and $57,400 for oranges. Prepare the company’s inventory purchases budgets for the next year, showing quarterly figures by product.

Ms. Jasper estimates next year’s ending inventory will be 35,900 for peaches. Prepare the company’s inventory purchases budgets for the next year, showing quarterly figures by product. (Round your final answers to nearest whole dollar.)

$221,197

Ms. Jasper estimates next year’s ending inventory will be 57,400 for oranges. Prepare the company’s inventory purchases budgets for the next year, showing quarterly figures by product. (Round your final answers to nearest whole dollar.)

First Quarter Second Quarter Third Quarter Fourth Quarter Total Peaches $ 237,000 $ 257,000 $ 317,000 $ 257,000 $ 1,068,000 Oranges 400,000 450,000 570,000 380,000 1,800,000 Total $ 637,000 $ 707,000 $ 887,000 $ 637,000 $ 2,868,000

Explanation / Answer

1.

2.

3. Peaches

Oranges

Sales Budget First Quarter Second Quarter Third Quarter Fourth Quarter Total Peaches $ 1,100,040 $ 1,133,041 $ 1,167,032 $ 1,202,043 $ 4,602,157 Oranges 1,944,000 2,099,520 2,267,482 2,448,880 8,759,882 Total $ 3,044,040 $ 3,232,561 $ 3,434,514 $ 3,650,924 $ 13,362,039

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