Problem 5-31 Crane Enterprises is a boutique guitar manufacturer. The company produces both acoustic and electric guitars for rising and established professional musicians. Vanessa Aaron, the company's sales manager, prepared the following sales forecast for 2018. The forecasted sales prices include a 5% increase in the acoustic quitar price and a 10% increase in the electric quitar price, to cover anticipated increases in raw materials prices 2nd Quarter 3rd Quarter 4th Quarter 1st Quarter Sales Price $1,200 Acoustic guitar sales 190 250 290 300 300 Electric guitar sales $2,350 380 330 340 Your answer is correct Prepare Crane's sales budget for 2018. Sales Budget 2nd Quarter 3rd Quarter 4th Quarter 1st Quarter Annual Acoustic Budgeted units sold 190 250 290 300 1030 1200 1200 1200 1200 1200 Budgeted sales price 300000 228000 348000 360000 1236000 Budgeted revenue Electric 700 13E0 Your answer is partially correct. Try again On December 31, 2017, Crane had 30 acoustic guitars in stock-fewer than the desired inventory level of 76 guitars, based on the following quarter's sales. The company has budgeted for sales of 240 acoustic guitars in the first quarter of 2019. Prepare the 2018 production budget for acoustic guitars. Production Budget 1st Quarter 2nd Quarter 3rd Quarter 4th Quarter Annual 250 Budgeted unit sales 190 300 290 1030 X Budgeted ending inventory 50 58 60 48 48 Total units required 240 308 350 348 1078 x X 30 30 50 58 60 Beginning inventory X X 210 258 292 288 1048 Budgeted production LINK TO TEXT LINK TO VIDEO X Each acoustic guitar requires a maple neck blank, which Crane purchases for $40. On December 31, 2017, Crane had 380 neck blanks in inventory. Spoilage during the production process results in a standard quantity of 1.5 necks per acoustic guitar. Because of recent delivery problems, Crane wants to maintain an ending inventory equal to 50% of the following quarter's production needs. Since the supplier has assured Crane that the delivery issues will be resolved by the end of December, Crane wants only 300 neck blanks in inventory on December 31, 2018. Prepare the purchases budget for neck blanks for 2018. (Enter "per guitar" value to 1 decimal place, e.g. 3.1. Round all other answers to 0 decimal places, e.g. 153.) Purchases Budget 2nd Quarter 1st Quarter 4th rd Annual Quarter Quarter Standard necks per guitar 1.5 1.5 1.5 1.5 1.5 Budgeted production 210 258 292 288 1048 387 315 Production needs 1572 438 432 194 219 216 300 300 Budgeted ending inventory Total DM required (necks) 509 606 654 732 1872 380 194 219 216 380 Beginning inventory Budgeted purchases (necks) 129 412 435 516 1492 Standard price per neck 40 40 40 40 40 16480 5160 17400 20640 59680 Budgeted purchases cost $
