Question

a.

Navigator sells GPS trackers for $55 each. It expects sales of 5,900 units in quarter 1 and a 5% increase each subsequent quarter for the next 8 quarters. Prepare a sales budget by quarter for the first year. Round final answers to nearest whole dollar.

For the Year Ending Dec. 31, 20XX
	Quarter 1	Quarter 2	Quarter 3	Quarter 4	Total
Expected Sales (Units)
Sales Price per Unit
Total Sales Revenue

b.  

makes universal remote controls and expects to sell 550 units in January, 750 in February, 500 in March, 500 in April, and 550 in May. The required ending inventory is 10% of the next month’s sales. Prepare a production budget for the first four months of the year.

For the Four Months Ending April 30, 20XX
	January	February	March	April
Expected Sales
Desired Ending Inventory
Total Required Units
Beginning Inventory
Required Production
Total

c. how much direct materials needs to be purchased?

Beginning materials inventory	$75,600
Ending materials inventory	79,000
Materials needed for production	460,000

Purchases required $

Answer 1

A)

Sales Budget

For the year ending December 31 , 20XX

	Quarter 1	Quarter 2	Quarter 3	Quarter 4	Total
Expected Sales (Units)	5,900	6,195	6,505	6,830	25,430
Sales Price per unit	$ 55	$ 55	$ 55	$ 55	$ 55
Total Sales Revenue	$324,500	$340,725	$357,775	$375,650	$1,398,650

B)

Production Budget

For the four months ending

April 30 , 20XX

	January	February	March	April
Expected sales	550	750	500	500
Desired ending inventory	75	50	50	55
Total Required units	625	800	550	555
Beginning Inventory	(55)	(75)	(50)	(50)
Required Production	570	725	500	505

C)

Calculation for Direct materials needed to be Purchased :

Materials needed for production	$ 460,000
Ending materials inventory	$ 79,000
Total required direct materials	$ 539,000
Beginning materials inventory	$ (75,600)
Purchase Required	$ 463,400

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