Solution-Prepare a sales budget for the first quarter of

Prepare a sales budget for the first quarter of the year

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Reference no: EM132960111

MPG Company specializes in unique baskets. The company has budgeted the following sales for the first four months of the year:

Month           Expected sales in units
January             4,000
February            6,000
March              20,000
April                2,000

The selling price of the baskets is $30 per unit. Based on history, the company expects that 10% of sales are cash received in the month of sale. Of the credit sales, half is collected one month after sale and the remainder is collected two months after sale. Accounts receivable as at January 1st was $100,000; all of which is expected to be collected in January.

The company wants ending inventory to be equal to 20% of the following month's budgeted sales in units. On January 1st, 1,000 units were on hand.

Required:

Problem a. Prepare a sales budget for the first quarter of the year.

Problem b. Prepare a schedule of expected cash collections for the first quarter of the year.

Problem c. Prepare a production budget for the first quarter of the year.

Reference no: EM132960111

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Prepare a sales budget for the first quarter of the year

Reference no: EM132960111

Reference no: EM132960111

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