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Please show all calculations for your Sales (in detail plz ) and Cost of Goods Sold figures for each month SP 22 Santana Rey expects
Please show all calculations for your Sales (in detail plz ) and Cost of Goods Sold figures for each month
SP 22 Santana Rey expects second-quarter 2016 sales of her new line of computer furniture to be the same as the first quarter's sales (reported below) without any changes in strategy. Monthly sales averaged 40 desk units (sales price of $1,250) and 20 chairs (sales price of $500). BUSINESS SOLUTIONS Sogment Income Statemont For Quarter Ended March 31,2016 Salos Cost of goods sold Gross profit Expenses Sales commissions (10%) $180,000 115,000 65,000 Other foxed expenses Total expenses Net income 8,000 9,000 18,000 45,000 20,000 Reflects revenue and expense activity only related to the computer furniture segment. Revenue: (120 desks X $1,250) +(60 chairs X $500)- $150,000+$30,000 $180,000 Cost of goods sold: (120 desks X $750) +(60 chairs XS250) SI0,000-S115,000 Santana Rey believes that sales will increase each month for the next three months (April, 48 desks, 32 chairs; May, 52 desks, 35 chairs; June, 56 desks, 38 chairs) if selling prices are reduced to $1,150 for desks and $450 for chairs, and advertising expenses are increased by 10% and remain at that level for all three months. The products' variable cost will remain at $750 for desks and $250 for chairs. The sales staff will continue to earn a 10% commission, the fixed manufacturing costs per month will remain at $10,000, and other fixed expenses will remain at $6,000 per month. Required 1. Prepare budgeted income statements for each of the months of April, May, and June that show the expected results from implementing the proposed changes. 2. Use the budgeted income statements from part 1 to recommend whether Santana Rey should implement the proposed changes. Explain
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