Stillwater Designs produces two subwoofers: S12L7 and S12L5. The S12L7 sells for $660, and the S12L5 sells for $417. Projected sales (number of speakers) for the coming five quarters are as follows:

	S12L7	S12L5
First quarter, 20X1	800	1,300
Second quarter, 20X1	2,200	1,400
Third quarter, 20X1	5,600	5,300
Fourth quarter, 20X1	4,600	3,900
First quarter, 20X2	900	1,200

Sales Budget for Year Ended in December 31 20X1

S12L7	1st Qtr	2nd QTR	3rd QTR	4th Qtr	Year
Units
Price
Sales
S12L5
Units
Price
Sales
Total Sales

How will Stillwater Designs use this sales budget?

1. Stillwater Designs will use the sales budget in planning as the basis for the production budget.

2. The company can also compare actual sales against the budget to see if expectations were achieved.

3. Both 1 and 2

4. None of the above