Question 2 Ash Creek Company is preparing its master budget for 2014. Relevant data pertaining to its sales, production, and direct materials budgets are as follows Sales: Sales for the year are expected to total 1,900,000 units. Quarterly sales are 19%, 27%, 24%, and 30%, respectively. The sales price is expected to be $40 per unit for the first three quarters and $44 per unit beginning in the fourth quarter. Sales in the first quarter of 2015 are expected to be 10% higher than the budgeted sales for the first quarter of 2014 Production: Management desires to maintain the ending finished goods inventories at 25% of the next quarter's budgeted sales volume. Direct materials: Each unit requires 2 pounds of raw materials at a cost of $11 per pound. Management desires to maintain raw materials inventories at 10% of the next quarter's production requirements. Assume the production requirements for the first quarter of 2015 are 509,500 pounds. Prepare the sales, production, and direct materials budgets by quarters for 2014. (Round answers to 0 decimal places, e.g. 5,275.) ASH CREEK COMPANY Sales Budget For the Year Ending December 31, 2014 Quarter 2 3 Year Expected unit sales Unit selling price Total sales