Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Milo Company manufactures beach umbrellas. The company is preparing detailed budgets for the third quarter and has assembled the following information to assist in the

image text in transcribedimage text in transcribedimage text in transcribed

Milo Company manufactures beach umbrellas. The company is preparing detailed budgets for the third quarter and has assembled the following information to assist in the budget preparation: a The Marketing Department has estimated sales as follows for the remainder of the year (in units): The selling price of the beach umbrellas is $10 per unit. October 20,500 30,500 July 71,000 August November7,000 40,000 December 7,500 September b All sales are on account. Based on past experience, sales are collected in the following pattern: 30% in the month of sale in the month 65% ofollowing sale 5% uncollectible Sales for June totaled $200,000. c. The company maintains finished goods inventories equal to 15% of the following month's sales. This requirement will be met at the end of June. d. Each beach umbrella requires 4 feet of Gilden, a material that is sometimes hard to acquire. Therefore, the company requires that the ending inventory of Gilden be equal to 50% of the following month's production needs. The inventory of Gilden on hand at the beginning and end of the quarter will be: June 30 73,150 feet September feet e Gilden costs $0.60 per foot. One-half of a month's purchases of Gilden is paid for in the month of purchase; the remainder is paid for in the following month. The accounts payable on July 1 for purchases of Gilden during June will be $34,890. Required: a Prepare a sales budget, by month and in total, for the third quarter July August Septembe Quarter Budgeted units sales Selling price per unit Budgeted sales

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Auditing IT Infrastructures For Compliance

Authors: Martin Weiss, Michael G. Solomon

2nd Edition

1284090701, 978-1284090703

More Books

Students also viewed these Accounting questions

Question

Why would a country rather domesticate than expropriate?

Answered: 1 week ago

Question

a. Did you express your anger verbally? Physically?

Answered: 1 week ago