Based on the following production and sales data of Frixion Co. for March of the current year, prepare the following:
Product T Product X
Estimated inventory, March 1 28,000 units 20,000 units
Desired inventory, March 31 32,000 units 15,000 units
Expected sales volume:
Territory I 320,000 units 260,000 units
Territory II 190,000 units 130,000 units
Unit sales price $6 $14
A. Prepare a sales budget.
B. Prepare a production budget.

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amcool amcool · Answer 1 · 2021-03-17T04:37:04+01:00

Answer:

A. Totals Sales in Territories I and II are as follows:

Product T Totals Sales in Territories I and II = $3,060,000

Product X Totals Sales in Territories I and II = $5,460,000

B. Required Production Units in March are as follows:

Product T Required Production Units in March = 514,000

Product T Required Production Units in March = 385,000

Explanation:

A. Prepare a sales budget.

Note: See part a of the attached excel file for sales budget and the formulae used in the calculations.

From the attached excel file, Totals Sales in Territories I and II are as follows:

Product T Totals Sales in Territories I and II = $3,060,000

Product X Totals Sales in Territories I and II = $5,460,000

B. Prepare a production budget.

Note: See part b of the attached excel file for sales budget and the formulae used in the calculations.

From the attached excel file, Required Production Units in March are as follows

Product T Required Production Units in March = 514,000

Product X Required Production Units in March = 385,000