Question

#1

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	282		90
Desired inventory (units), June 30	324		78
Expected sales volume (units):
Midwest Region	4,300		4,800
South Region	4,950		5,600
Unit sales price	$130		$195

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
Total units to be produced

Answer 1

Sales budget

	Unit Sales Volume	Unit Selling price	Total Sales
Model: Rumble
Midwest region	4300	130	559000
south region	4950	130	643500
Total			1202500
Model: Thunder
Midwest region	4800	195	936000
south region	5600	195	1092000
Total			2028000
Total revenue from sales			3230500

Production budget

	Units rumble	Units thunder
Sales unit	9250	10400
Add: Desired ending inventory	324	78
Total	9574	10478
Less; Beginning inventory	-282	-90
Total units to be produced	9292	10388