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rembrandt frame company prepared the following sales budget for the current year 647755

Rembrandt Frame Company prepared the following sales budget for the current year:

 

Unit Sales

Unit Selling

 

Product and Area

Volume

Price

Total Sales

8” × 10” Frame:

 

 

 

East

29,000

$14.00

$ 406,000

Central

22,000

14.00

308,000

West

31,500

14.00

441,000

Total

82,500

 

$1,155,000

12” × 16” Frame:

 

 

 

East

16,000

$24.00

$ 384,000

Central

10,500

24.00

252,000

West

15,000

24.00

360,000

Total

41,500

 

$ 996,000

Total revenue from sales

 

 

$2,151,000

At the end of December 2008, the following unit sales data were reported for the year:

 

Unit Sales

 

8” × 10”

12” × 16”

 

Frame

Frame

East

29,725

16,480

Central

22,770

10,710

West

30,240

14,325

For the year ending December 31, 2009, unit sales are expected to follow the patterns established during the year ending December 31, 2008. The unit selling price for the 8 × 10 × frame is expected to change to $12, and the unit selling price for the 12 × 16 × frame is expected to change to $21, effective January 1, 2009.

Instructions

1. Compute the increase or decrease of actual unit sales for the year ended December 31, 2008, over budget. Place your answers in a columnar table with the following format:

 

Unit Sales,

Increase (Decrease)

 

Year Ended 2008

Actual Over Budget

 

Budget

Actual Sales

Amount

Percent

8” × 10” Frame:

 

 

 

 

East

 

 

 

 

Central

 

 

 

 

West

 

 

 

 

12” _ 16” Frame:

 

 

 

 

East

 

 

 

 

Central

 

 

 

 

West

 

 

 

 

2. Assuming that the trend of sales indicated in part (1) is to continue in 2009, compute the unit sales volume to be used for preparing the sales budget for the year ending December 31, 2009. Place your answers in a columnar table similar to that in part (1) above but with the following column heads. Round budgeted units to the nearest unit.

2008

Percentage

2009

Actual

Increase

Budgeted

Units

(Decrease)

Units (rounded)

3. Prepare a sales budget for the year ending December 31, 2009.

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