Question

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	262		76
Desired inventory (units), June 30	301		66
Expected sales volume (units):
Midwest Region	3,800		3,350
South Region	4,800		5,400
Unit sales price	$140		$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
Total units to be produced

Answer 1

• All working forms part of the answer
• Requirement ‘a’

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	3,800	$               140.00	$             532,000.00
South Region	4,800	$               140.00	$             672,000.00
Total	8,600		$           1,204,000.00
Model: Thunder
Midwest Region	3,350	$               195.00	$             653,250.00
South Region	5,400	$               195.00	$           1,053,000.00
Total	8,750		$           1,706,250.00
Total revenue from sales			$           2,910,250.00

• Requirement ‘b’

Sonic Inc.
Production Budget
For the Month Ending June 30
	Units Rumble	Units Thunder
Budgeted Sales units	8,600	8,750
Desired Inventory June 30	301	66
Total	8,901	8,816
Estimated Inventory June 1	(262)	(76)
Total units to be produced	8,639	8,740