Question

Sales and Production Budgets

Sonic Inc. manufactures two models of speakers, Rumble and Thunder. Based on the following production and sales data for June, prepare (a) a sales budget and (b) a production budget:

	Rumble		Thunder
Estimated inventory (units), June 1	750		300
Desired inventory (units), June 30	500		250
Expected sales volume (units):
Midwest Region	12,000		3,500
South Region	14,000		4,000
Unit sales price	$60		$90

a. Prepare a sales budget.

Sonic Inc.
Sales Budget
For the Month Ending June 30
Product and Area	Unit Sales Volume	Unit Selling Price	Total Sales
Model: Rumble
Midwest Region
South Region
Total
Model: Thunder
Midwest Region
South Region
Total
Total revenue from sales

b. Prepare a production budget. For those boxes in which you must enter subtracted or negative numbers use a minus sign.

Sonic Inc.
Production Budget
For the Month Ending June 30
	Units Rumble	Units Thunder
Total units available
Total units to be produced

Answer 1

Sales Budget
	Unit Sales	Unit	Total
Product and Area	Volume	Selling Price	Sales
Model: Rumble
Midwest Region	12000	$   60.00	$   7,20,000.00
South Region	14000	$   60.00	$   8,40,000.00
Total	26000		$ 15,60,000.00
Model: Thunder
Midwest Region	3500	$   90.00	$   3,15,000.00
South Region	4000	$   90.00	$   3,60,000.00
Total	7500		$   6,75,000.00
Total revenue from sales			$ 22,35,000.00

	Production Budget
				Units	Units
				Rumble	Thunder
	Expected units to be sold			26000	7500
Add:	Desired inventory (units), June 30			500	250
	Total units available			26500	7750
Less:	Estimated inventory (units), June 1			-750	-300
	Total units to be produced			25750	7450