The company has just hired a new marketing manager who insists that unit sales can be dramatically increased by dropping the selling price from $$8$ to $$7.$ The marketing manager would like to use the following projections in the budget:

Data Year $2$ Quarter Year $3$ Quarter

$123412$

Budgeted unit sales $45,00070,000110,00070,00085,00090,000$

Selling price per unit $ $7$

a$.$ What are the total expected cash collections for the year under this revised budget?

b$.$ What is the total required production for the year under this revised budget?

c$.$ What is the total cost of raw materials to be purchased for the year under this revised budget?

d$.$ What are the total expected cash disbursements for raw materials for the year under this revised budget?

e$.$ After seeing this revised budget, the production manager cautioned that due to the current production constraint, a complex milling machine, the plant can produce no more than $80,000$ units in any one quarter. Is this a potential problem?

multiple choice

Yes

No