5.31 (LO 3) Integrated sales budget, production budget, and purchases budget Simmons Enterprises is a boutique guitar manufacturer. The company produces both acoustic and electric guitars for rising and established professional musicians. Vanessa Aaron, the companys sales manager, prepared the following sales forecast for 2022. The forecasted sales prices include a 5% increase in the acoustic guitar price and a 10% increase in the electric guitar price, to cover anticipated increases in raw materials prices.

	Sales Price	1s Qtr	2nd Qtr	3rd Qtr	4th Qtr
Acoustic sales	$1250	200	280	300	330
Electric guitar sales	$2400	400	350	320	360

Required

a. Prepare Simmonss sales budget for 2022.

b.On December 31, 2021, Simmons had 30 acoustic guitars in stockfewer than the desired inventory level of 80 guitars, based on the following quarters sales. The company has budgeted for sales of 240 acoustic guitars in the first quarter of 2023. Prepare the 2022 production budget for acoustic guitars.

c. Each acoustic guitar requires a maple neck blank, which Simmons purchases for $45. On December 31, 2021, Simmons had 200 neck blanks in inventory. The production process results in a standard quantity of 1 neck per acoustic guitar. Because of recent delivery problems, Simmons wants to maintain an ending inventory equal to 50% of the following quarters production needs. Since the supplier has assured Simmons that the delivery issues will be resolved by the end of December, Simmons wants only 150 neck blanks in inventory on December 31, 2022. Prepare the purchases budget for neck blanks for 2022.