Living Corner sells home wares and various otherreading-related products. One of the store's most popular products is the fluffy pillow. The pillow each sell for $26.00. Originally the pillows were handmade by a local artisan. The store's owner has been impressed with the demand for the pillow and has recently begun a small manufacturing company to produce and distribute the pillow to otherstores. Estimated sales for the fourth quarter (in units) are as follows: October 9 500 November 10 200 December 12 600 Total 32 300 Required: a) Prepare a sales budget for the fourth quarter based on the above information. b) Prepare a production budget for the pillow manufacturing company. The company did not have any inventory at the end of September, but they want to maintain a 20 percent inventory at the end of each month based on the next month's sales. January's sales are expected to be low, given the post-holiday trends and are estimated to be 6800 units. c) Explain the benefits of budgeting and why budgets do not always achieve their required results

Living Corner sells home wares and various otherreading-related products. One of the store's most popular products is the fluffy pillow. The pillow each sell for $26.00. Originally the pillows were handmade by a local artisan. The store's owner has been impressed with the demand for the pillow and has recently begun a small manufacturing company to produce and distribute the pillow to otherstores. Estimated sales for the fourth quarter (in units) are as follows: October 9 500 November 10 200 December 12 600 Total 32 300 Required: a) Prepare a sales budget for the fourth quarter based on the above information. b) Prepare a production budget for the pillow manufacturing company. The company did not have any inventory at the end of September, but they want to maintain a 20 percent inventory at the end of each month based on the next month's sales. January's sales are expected to be low, given the post-holiday trends and are estimated to be 6800 units. c) Explain the benefits of budgeting and why budgets do not always achieve their required results

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Hansaben
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