Archer Company produces two products: the custom and the basic. The custom sells for $30, and the basic sells for $8. Projected sales of the two models for the coming four quarters are given below.

	Custom	Basic
First quarter	12,000	90,000
Second quarter	14,500	88,200
Third quarter	16,500	93,000
Fourth quarter	20,000	91,400

The president of the company believes that the projected sales are realistic and can be achieved by the company. In the factory, the production supervisor has received the projected sales figures and gathered information needed to compile production budgets. He found that 800 customs and 1,140 basics were in inventory on January 1. Company policy dictates that ending inventory should equal 20 percent of the next quarter's sales for customs and 10 percent of next quarter's sales for basics.

Required:

Question Content Area

1. Prepare a sales budget for each quarter and for the year in total. Show sales by product and in total for each time period.

Archer Company Sales Budget For the Year Ended December 31

	Quarter 1	Quarter 2	Quarter 3	Quarter 4	Year
Custom:
Units	fill in the blank d3d9a0ff5075fea_1	fill in the blank d3d9a0ff5075fea_2	fill in the blank d3d9a0ff5075fea_3	fill in the blank d3d9a0ff5075fea_4	fill in the blank d3d9a0ff5075fea_5
Unit price	$fill in the blank d3d9a0ff5075fea_6	$fill in the blank d3d9a0ff5075fea_7	$fill in the blank d3d9a0ff5075fea_8	$fill in the blank d3d9a0ff5075fea_9	$fill in the blank d3d9a0ff5075fea_10
Sales	$fill in the blank d3d9a0ff5075fea_11	$fill in the blank d3d9a0ff5075fea_12	$fill in the blank d3d9a0ff5075fea_13	$fill in the blank d3d9a0ff5075fea_14	$fill in the blank d3d9a0ff5075fea_15
Basic:
Units	fill in the blank d3d9a0ff5075fea_16	fill in the blank d3d9a0ff5075fea_17	fill in the blank d3d9a0ff5075fea_18	fill in the blank d3d9a0ff5075fea_19	fill in the blank d3d9a0ff5075fea_20
Unit price	$fill in the blank d3d9a0ff5075fea_21	$fill in the blank d3d9a0ff5075fea_22	$fill in the blank d3d9a0ff5075fea_23	$fill in the blank d3d9a0ff5075fea_24	$fill in the blank d3d9a0ff5075fea_25
Sales	$fill in the blank d3d9a0ff5075fea_26	$fill in the blank d3d9a0ff5075fea_27	$fill in the blank d3d9a0ff5075fea_28	$fill in the blank d3d9a0ff5075fea_29	$fill in the blank d3d9a0ff5075fea_30
Total Sales	$fill in the blank d3d9a0ff5075fea_31	$fill in the blank d3d9a0ff5075fea_32	$fill in the blank d3d9a0ff5075fea_33	$fill in the blank d3d9a0ff5075fea_34	$fill in the blank d3d9a0ff5075fea_35

Question Content Area

2. Prepare a separate production budget for each product for each of the first three quarters of the year.

Production budget for customs:

Archer Company Production Budget for Customs First Three Quarters of the Year

	Quarter 1	Quarter 2	Quarter 3
Unit sales	fill in the blank 65acd5f84043f97_1	fill in the blank 65acd5f84043f97_2	fill in the blank 65acd5f84043f97_3
Desired ending inventoryLess: Beginning inventoryUnits producedUnit sales	- Select -	- Select -	- Select -
Total needed	fill in the blank 65acd5f84043f97_8	fill in the blank 65acd5f84043f97_9	fill in the blank 65acd5f84043f97_10
Desired ending inventoryLess: Beginning inventoryUnits producedUnit sales	- Select -	- Select -	- Select -
Units produced	fill in the blank 65acd5f84043f97_15	fill in the blank 65acd5f84043f97_16	fill in the blank 65acd5f84043f97_17

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Production budget for basics:

Archer Company Production Budget for Basics First Three Quarters of the Year

	Quarter 1	Quarter 2	Quarter 3
Unit sales	fill in the blank e5346ef8e021042_1	fill in the blank e5346ef8e021042_2	fill in the blank e5346ef8e021042_3
Desired ending inventoryLess: Beginning inventoryUnits producedUnit sales	- Select -	- Select -	- Select -
Total needed	fill in the blank e5346ef8e021042_8	fill in the blank e5346ef8e021042_9	fill in the blank e5346ef8e021042_10
Desired ending inventoryLess: Beginning inventoryUnits producedUnit sales	- Select -	- Select -	- Select -
Units produced	fill in the blank e5346ef8e021042_15	fill in the blank e5346ef8e021042_16	fill in the blank e5346ef8e021042_17