Question #$1$

You are the Greenville Production Limited. The company produces two $(2)$ products,

"Natural Life and Herbal Life". The following sales forecast for both products was

decided on for the financial year January $1,2022$ to December $31,2022$:

Sales forecast

Notes:

$($i$)$ The company planned to sell one unit of herbal life for $$900$ and one unit of

natural life for $$1,500$ during $2022.$

$($ii$)$ The sales forecast for the first quarter of $2023$ is $5,000$ units of natural life

and $4,900$ units of herbal life.

$($iii$)$ The closing stock level for both products at the end of each quarter is to be

held at a level equal to fifteen percent $)$ of the budgeted sales for the

next quarter.

$($iv$)$ At the start of $2022$ there were in stock $1,200$ units of natural life and $1,400$

units of herbal life.

$($v$)$ To make one unit of natural life, five $(5)$ units of raw material vitamins are

required, while four $(4)$ units of raw material calcium are required to make

one unit of herbal life.

$($vi$)$ The cost of raw material vitamin is $$90$ per unit, while the cost of raw material

calcium is $$60$ per unit.

$($vii$)$ Closing raw material stocks in units in store at the end of each quarter is to be

equivalent to thirty percent $(30\%)$ of the forecasted sales for the previous

quarter. Budgeted sales for the fourth quarter of $2021$ were natural life,

$5,400$ units and herbal life $5,200$ units.

$($viii$)$ At the start of $2022,$ first quarter, opening inventory of raw material were

$2,700$ units of raw material vitamin and $3,400$ units of raw material calcium

in store.

Required:

$($a$)$ The sales budget for both products for $2022.$

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