Ronwar Company has prepared a unit sales budget for the upcoming months of 2022 as follows: Months Units Months Units January February. March.... 5,000 June 30,000 7,500 July 35,000 August ... September... 10,000 25,000 April... 15,000 10,000 May 20,000 October.. 6,000 Products are to be sold at P75 per unit and estimated cost is P45 per unit. The company has a policy to maintain inventory levels equal to 25% of the coming month's sales requirements. Inventory on January 1 is projected to be 2,100 units. Required: 1. Prepare the sales for all the ten months. No need to input accumulated totals for all the ten months. 2. Prepare the purchases budget (in units) for ABC Company for the first five months only. No need to input accumulated totals for all the five months.
Ronwar Company has prepared a unit sales budget for the upcoming months of 2022 as follows: Months Units Months Units January February. March.... 5,000 June 30,000 7,500 July 35,000 August ... September... 10,000 25,000 April... 15,000 10,000 May 20,000 October.. 6,000 Products are to be sold at P75 per unit and estimated cost is P45 per unit. The company has a policy to maintain inventory levels equal to 25% of the coming month's sales requirements. Inventory on January 1 is projected to be 2,100 units. Required: 1. Prepare the sales for all the ten months. No need to input accumulated totals for all the ten months. 2. Prepare the purchases budget (in units) for ABC Company for the first five months only. No need to input accumulated totals for all the five months.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Concept explainers
Master Budget
A master budget can be defined as an estimation of the revenue earned or expenses incurred over a specified period of time in the future and it is generally prepared on a periodic basis which can be either monthly, quarterly, half-yearly, or annually. It helps a business, an organization, or even an individual to manage the money effectively. A budget also helps in monitoring the performance of the people in the organization and helps in better decision-making.
Sales Budget and Selling
A budget is a financial plan designed by an undertaking for a definite period in future which acts as a major contributor towards enhancing the financial success of the business undertaking. The budget generally takes into account both current and future income and expenses.
Question
100%
Transcribed Image Text:Ronwar Company has prepared a unit sales budget for the upcoming months of 2022 as
follows:
Months
Units
Months
Units
5,000
30,000
January.
February..
June
July
August
September..
7,500
35,000
March..
10,000
25,000
April...
15,000
10,000
May ...
20,000
October...
6,000
...............
Products are to be sold at P75 per unit and estimated cost is P45 per unit. The company has
a policy to maintain inventory levels equal to 25% of the coming month's sales requirements.
Inventory on January 1 is projected to be 2,100 units.
Required:
1. Prepare the sales for all the ten months. No need to input accumulated totals for all the
ten months.
2. Prepare the purchases budget (in units) for ABC Company for the first five months only.
No need to input accumulated totals for all the five months.
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 2 steps with 1 images
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education