Integrated sales budget, production budget, and purchases budget. Go- Spa Enterprises is a portable hot tub manufacturer. The company produces both 2-person and 4-person hot tubs. John Ireland the company's sales manager, prepared the following sales forecast for 2015. The forecasted sales prices include a 5 percent increase in the 2-person spa price and a 10 percent increase in the 4-person spa price, to cover anticipated increases in raw materials prices.

	sales price	1st quarter	2nd quarter	3rd quarter	4ht quarter
2-person spa	$1,250	500	500	400	600
4-person spa	$2,600	200	100	100	200

Required:

a. Prepare GO-Spa's sales budget for 2015

b. On December 31, 2014, Go-Spa had 80 2-person spas in stock--fewer than the desired inventory level of 100, based on the following quarter's sales. The company has budgeted for sales of 450 2-person spas in the first quarter of 2016. Prepare the 2015 production budget for 2-person spas.

c. Each 2-person spa requires a pump motor, which Go-Spa purchases for $160. On december 31, 2014, Go-Spa had 400 pump motors in inventory. Damage during the installation processs results in a standard quantity of 1.2 motors per spa. Because of recent delivery problems, Go-Spa wants to maitain an ending inventory equal to 50 percent of the following quarters production needs. Since the supplier has assured Go-Spa that the delivery issues will be resolved by the end of December, Go-Spa wants only 300 motors in inventory on December 31, 2015. Prepare the purchases budget for motors for 2015.