the accounts receivable as of that date EXERCISE 92 Sales an

the accounts receivable as of that date EXERCISE 9-2 Sales and Production Budget [LO2] The marketing department of Graber Corporation has submitted the following sales forecast for the upcoming fiscal year. First Quarter Second Quarter Third Quarter Fourth Quarter 6000 5,00 4,000 15000 The selling price of the company\'s product is $22.00 per unit. Management expects to collect 75% of sales in the quarter in which the sales are made and 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 $66,000. The company expects to start the first quarter with 3,200 units in finished goods inventory. Management desires an ending finished goods inventory in each quarter equal to 20% of the next quarter\'s budgeted sales. The desired ending finished goods inventory for the fourth quarter is 3,400 units. Required: 1. Prepare the company\'s sales budget and schedule of expected cash collections. 2. Prepare the company\'s production budget for the upcoming fiscal year. EXERCISE 9-3 Direct Materials Purchases Budget [LO2] Exercise 9-3: Help Me Solve It Tutorial

Solution

1) Sales budget: I II III IV Expected Units sold 16000 15000 14000 15000 Selling price $ 22 22 22 22 Total Selling $ 352000 330000 308000 330000 Expected Cash Collections: I II III IV last year 52800 I 264000 70400 II 247500 66000 III 231000 61600 IV 247500 total 316800 317900 297000 309100 2) Expected Production Budget: I II III IV Expected Units sold 16000 15000 14000 15000 Add: Ending Inventory 3000 2800 3000 3400 20% of next qter sales Total required 19000 17800 17000 18400 Less: Beginning inventory 3200 3000 2800 3000 Production required 15800 14800 14200 15400