Question
Waterway Company is preparing its master budget for 2022. Relevant data pertaining to its sales, production, and direct materials budgets are as follows. Sales :
Waterway Company is preparing its master budget for 2022. Relevant data pertaining to its sales, production, and direct materials budgets are as follows. Sales: Sales for the year are expected to total 1,100,000 units. Quarterly sales are 20%, 25%, 25%, 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 2023 are expected to be 10% higher than the budgeted sales for the first quarter of 2022. Production: Management desires to maintain the ending finished goods inventories at 20% of the next quarter's budgeted sales volume. Direct materials: Each unit requires 2 kg of raw materials at a cost of $10 per kilogram. 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 2023 are 520,000 kg.
(a1)
Prepare the sales budget by quarters for 2022.
WATERWAY COMPANY Sales Budget (in thousands) For the Year Ending December 31, 2022 | ||||||||||
---|---|---|---|---|---|---|---|---|---|---|
Quarter | ||||||||||
1 | 2 | 3 | 4 | Year | ||||||
Unit sales | enter a number for units | enter a number for units | enter a number for units | enter a number for units | enter a number for units | |||||
Unit price | $enter a dollar amount | $enter a dollar amount | $enter a dollar amount | $enter a dollar amount | ||||||
Total sales | $enter a total dollar amount | $enter a total dollar amount | $enter a total dollar amount | $enter a total dollar amount | $enter a total dollar amount |
(a2)
Prepare the production budget by quarters for 2022. (Round answers to 2 decimal places, e.g. 15.25)
WATERWAY COMPANY Production Budget (in thousands) For the Year Ending December 31, 2022 | |||||||||
---|---|---|---|---|---|---|---|---|---|
Quarter | Year | ||||||||
1 | 2 | 3 | 4 | ||||||
select an opening production budget item Finished goodsUnit salesTotal requiredBeginning inventoryEnding inventory | enter a number of units | enter a number of units | enter a number of units | enter a number of units | enter a number of units | ||||
select between addition and deduction AddLess: select a production budget item Total requiredBeginning inventoryEnding inventoryFinished goodsUnit sales | enter a number of units | enter a number of units | enter a number of units | enter a number of units | enter a number of units | ||||
select a summarizing line for the first part Finished goodsEnding inventoryUnit salesBeginning inventoryTotal required | enter a total number of units for the first part | enter a total number of units for the first part | enter a total number of units for the first part | enter a total number of units for the first part | enter a total number of units for the first part | ||||
select between addition and deduction AddLess: select a production budget item Finished goodsUnit salesBeginning inventoryEnding inventoryTotal required | enter a number of units | enter a number of units | enter a number of units | enter a number of units | enter a number of units | ||||
Total | enter a total number of units | enter a total number of units | enter a total number of units | enter a total number of units | enter a total number of units |
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