1 Chapter 8: Applying Excel 2 3 Data 4 5 Budgeted unit sales 6 7 • Selling price per unit 8 Accounts receivable, beginning balance 9 Sales collected in the quarter sales are made 10 Sales collected in the quarter after sales are made 11 Desired ending finished goods inventory is 12 Finished goods inventory, beginning 14 • 13 Raw materials required to produce one unit Desired ending inventory of raw materials is 15 Raw materials inventory, beginning 16 Raw material costs 1 2 3 4 45,000 65,000 120,000 65,000 $ 7 per unit $ 65,000 75% 25% 30% of the budgeted unit sales of the next quarter 12,000 units 5 pounds 10% of the next quarter's production needs 23,000 pounds $ 0.80 per pound Year 3 Quarter 1 2 80,000 90,000
The company just hired a new marketing manager who insists unit sales can be dramatically increased by dropping the selling price from $8 to $7. The marketing manager would like to use the following projections in the budget:
Year 2 Quarter Year 3 Quarter
Data 1 2 3 4 1 2
Budgeted unit sales 45,000 65,000 120,000 65,000 80,000 90,000
Selling price per unit $7
What are the total expected cash collections for the year under this revised budget?
What is the total required production for the year under this revised budget? What is the total cost of raw materials to be purchased for the year under this revised budget? What are the total expected cash disbursements for raw materials for the year under this revised budget?
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