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	233		75
Desired inventory (units), June 30	268		65
Expected sales volume (units):
Midwest Region	2,600		2,900
South Region	5,050		5,700
Unit sales price	$125		$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 units available
Total units to be produced

Answer 1

a.)	Sales Budget
	Product and Area	Units Sales Volume	Unit selling price	Total Sales
	Model: Rumble
	Midwest region	2,600	125	325,000
	South region	5,050	125	631,250
	Total	7,650		$ 956,250
	Model:Thunder
	Midwest region	2,900	195	565,500
	South region	5,700	195	1,111,500
	Total	8,600		$ 1,677,000
	Total revenue from sales			$ 2,633,250
b.)	Production Budget
		Units Rumble	Units Thunder
	Budgeted Sales	7,650	8,600
	Add: Desired Inventory , June 30	268	65
	Total Units available	7,918	8,665
	Less: Estimated Inventory, June 1	-233	-75
	Total units to be produced	7,685	8,590