
Concept explainers
1.
The estimated sale for each quarter of the fiscal year
Introduction: Budget is the evaluation of the revenue and the expense which is expected incur in the specified period.
1.

Answer to Problem 14E
Solution: The estimated sale for each quarter of the fiscal year is $900,000
Explanation of Solution
Particulars | 1 | 2 | 3 | 4 | Total |
Budgeted unit sales | 11,000 | 12,000 | 14,000 | 13,000 | 50,000 |
Selling price per unit | 18 | 18 | 18 | 18 | 18 |
Total sales | 198,000 | 216,000 | 252,000 | 234,000 | 900,000 |
2.
The expected cash collection for each quarter of the fiscal year
Introduction: Budget is the evaluation of the revenue and the expense which is expected incur in the specified period.
2.

Answer to Problem 14E
Solution: The expected cash collection for each quarter of the fiscal year is $849,600
Explanation of Solution
Particulars | 1 | 2 | 3 | 4 | Total |
$70,200 | 70,200 | ||||
Quarter 1 sales | 128,700 | 59,400 | 188,100 | ||
Quarter 2 sale | 140,400 | 64,800 | 205,200 | ||
Quarter 3 sales | 163,800 | 70,200 | 234,000 | ||
Quarter 4 sales | 152,100 | 152,100 | |||
Total cash collection | 198,900 | 199800 | 228,600 | 222,300 | 849,600 |
Working notes:
Calculate the total cash collection of Quarter 1.
Calculate the total cash collection of Quarter 2.
Calculate the total cash collection of Quarter 3.
Calculate the total cash collection of Quarter 4.
Calculate the cash collection of quarter 1 sales in quarter 2,
Calculate the cash collection of quarter 2 sales in quarter 3,
Calculate the cash collection of quarter 3 sales in quarter 4,
3.
The required production in the units goods for the each quarter
Introduction: Budget is the evaluation of the revenue and the expense which is expected incur in the specified period.
3.

Answer to Problem 14E
Solution: The required production in the units goods for the each quarter is $12,900
Explanation of Solution
Calculate the production budget of J.
Particulars | 1 | 2 | 3 | 4 | Total | |
Budgeted unit sales | 11,000 | 12,000 | 14,000 | 13,000 | 50,000 | |
Add: | Desired ending inventory(15% of next quarter sales) | 1,800 | 2,100 | 1,950 | 1,850 | 1850 |
Total units | 12,800 | 14,100 | 15,950 | 14,850 | 51,850 | |
Less: | Beginning inventory | 1,650 | 1,800 | 2,100 | 1,950 | 1,850 |
Required production | 11,150 | 12,300 | 13,850 | 12,850 | 12,900 | |
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Chapter 8 Solutions
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