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	271		75
Desired inventory (units), June 30	312		65
Expected sales volume (units):
Midwest Region	3,650		4,100
South Region	5,250		4,550
Unit sales price	$140		$225

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

a) Sales budget

Product and Area	Unit Sales volume	Unit Selling price	Total Sales
Model: Rumble
Midwest Region	3650	140	511000
South region	5250	140	735000
Total	8900		1246000
Model: Thunder
Midwest Region	4100	225	922500
South region	4550	225	1023750
Total	8650		1946250
Total revenue from sales			3192250

Production budget

	Unit Rumble	Units thunder
Sale units	8900	8650
Add: Desired ending inventory	312	65
Total	9212	8715
Less; Beginning inventory	-271	-75
Total units to be produced	8941	8640