Sales and Production Budgets

Berring Company produces two products: the deluxe and the standard. The deluxe sells for $40, and the standard sells for $10. Projected sales of the two models for the coming four quarters are given below.

	Deluxe	Standard
First quarter	12,000	90,000
Second quarter	14,500	88,600
Third quarter	16,800	93,000
Fourth quarter	20,000	91,800

The president of the company believes that the projected sales are realistic and can be achieved by the company. In the factory, the production supervisor has received the projected sales figures and gathered information needed to compile production budgets. He found that 1,300 deluxes and 1,170 standards were in inventory on January 1. Company policy dictates that ending inventory should equal 20 percent of the next quarters sales for deluxes and 10 percent of next quarters sales for standards.

Required:

1. Prepare a sales budget for each quarter and for the year in total. Show sales by product and in total for each time period.

Berring Company Sales Budget For the Year Ended December 31

	Quarter 1	Quarter 2	Quarter 3	Quarter 4	Year
Deluxe:
Units	fill in the blank a0f56c020fbd064_1	fill in the blank a0f56c020fbd064_2	fill in the blank a0f56c020fbd064_3	fill in the blank a0f56c020fbd064_4	fill in the blank a0f56c020fbd064_5
Unit price	$fill in the blank a0f56c020fbd064_6	$fill in the blank a0f56c020fbd064_7	$fill in the blank a0f56c020fbd064_8	$fill in the blank a0f56c020fbd064_9	$fill in the blank a0f56c020fbd064_10
Sales	$fill in the blank a0f56c020fbd064_11	$fill in the blank a0f56c020fbd064_12	$fill in the blank a0f56c020fbd064_13	$fill in the blank a0f56c020fbd064_14	$fill in the blank a0f56c020fbd064_15
Standard:
Units	fill in the blank a0f56c020fbd064_16	fill in the blank a0f56c020fbd064_17	fill in the blank a0f56c020fbd064_18	fill in the blank a0f56c020fbd064_19	fill in the blank a0f56c020fbd064_20
Unit price	$fill in the blank a0f56c020fbd064_21	$fill in the blank a0f56c020fbd064_22	$fill in the blank a0f56c020fbd064_23	$fill in the blank a0f56c020fbd064_24	$fill in the blank a0f56c020fbd064_25
Sales	$fill in the blank a0f56c020fbd064_26	$fill in the blank a0f56c020fbd064_27	$fill in the blank a0f56c020fbd064_28	$fill in the blank a0f56c020fbd064_29	$fill in the blank a0f56c020fbd064_30
Total Sales	$fill in the blank a0f56c020fbd064_31	$fill in the blank a0f56c020fbd064_32	$fill in the blank a0f56c020fbd064_33	$fill in the blank a0f56c020fbd064_34	$fill in the blank a0f56c020fbd064_35

2. Prepare a separate production budget for each product for each of the first three quarters of the year.

Production budget for deluxes:

Berring Company Production Budget for Deluxes First Three Quarters of the Year

	Quarter 1	Quarter 2	Quarter 3
Unit sales	fill in the blank dc4106fe6fd407b_1	fill in the blank dc4106fe6fd407b_2	fill in the blank dc4106fe6fd407b_3
Desired ending inventoryLess: Beginning inventoryUnits producedUnit sales	- Select -	- Select -	- Select -
Total needed	fill in the blank dc4106fe6fd407b_8	fill in the blank dc4106fe6fd407b_9	fill in the blank dc4106fe6fd407b_10
Desired ending inventoryLess: Beginning inventoryUnits producedUnit sales	- Select -	- Select -	- Select -
Units produced	fill in the blank dc4106fe6fd407b_15	fill in the blank dc4106fe6fd407b_16	fill in the blank dc4106fe6fd407b_17

Production budget for standards:

Berring Company Production Budget for Standards First Three Quarters of the Year

	Quarter 1	Quarter 2	Quarter 3
Unit sales	fill in the blank 2d2631fa9076fb4_1	fill in the blank 2d2631fa9076fb4_2	fill in the blank 2d2631fa9076fb4_3
Desired ending inventoryLess: Beginning inventoryUnits producedUnit sales	- Select -	- Select -	- Select -
Total needed	fill in the blank 2d2631fa9076fb4_8	fill in the blank 2d2631fa9076fb4_9	fill in the blank 2d2631fa9076fb4_10
Desired ending inventoryLess: Beginning inventoryUnits producedUnit sales	- Select -	- Select -	- Select -
Units produced	fill in the blank 2d2631fa9076fb4_15	fill in the blank 2d2631fa9076fb4_16	fill in the blank 2d2631fa9076fb4_17