Question

oration has submitted the following sales forecast for the upcoming fiscal year (all sales are d account): 1st Quarter 2nd Quarter 3rd Quarter 4th Quarter 13,580 Budgeted unit sales 11,580 12,588 14,5ee The selling price of the company's product is $14 per unit. Managerment expects to collect 75% of sales in the quarter in which the sales are made, 20% in the following quarter, and 5% of sales are expected to be uncollectible. The beginning balance of accounts receivable, all of which is expected to be collected in the first quarter, is $71,200 The company expects to start the first quarter with 1,725 units in finished goods inventory. Management desires an ending finished goods inventory in each quarter equal to 15% of the next quarter's budgeted sales. The desired ending finished goods inventory for the fourth quarter is 1,925 units. Required: 1. Calculate the estimated sales for each quarter of the fiscal year and for the year as a whole 2. Calculate the expected cash collections for each quarter of the fiscal year and for the year as a whole 3. Calculate the required production in units of finished goods for each quarter of the fiscal year and for the year as a whole Complete this question by entering your answers in the tabs below

Answer 1

Answer:-1)-

Jessi Corporation
Estimated Sales
For the Year ended
Particulars	1st Quarter	2nd Quarter	3rd Quarter	4th Quarter	Total
Budgeted sales units (a)	11500	12500	14500	13500	52000
Selling price per unit (b)	$14	$14	$14	$14	$14
Estimated sales $ (c=a*b)	161000	175000	203000	189000	728000

2)-

Jessi Corporation
Schedule of Collections from sales
For the Year ended
Particulars	1st Quarter	2nd Quarter	3rd Quarter	4th Quarter	Total
	$	$	$	$	$
Opening receivable (a)	71200	0	0	0	71200
Cash Collection (b)
75% in quarter of sale	161000*75%=120750	175000*75%=131250	203000*75%=152250	189000*75% =141750	546000
20% in following quarter of sale		161000*20%=32200	175000*20%=35000	203000*20%=40600	107800
Total cash collections (c=a+b)	191950	163450	187250	182350	725000

3)-

Jessi Corporation
Calculation of production units
For the Year ended
Particulars	1st Quarter	2nd Quarter	3rd Quarter	4th Quarter	Total
Budgeted units sales	11500	12500	14500	13500	52000
Add:- Closing invetory of finished goods
15% of the next quarter's budgeted sales	12500*15%=1875	14500*15%=2175	13500*15%=2025	1925	8000
Less:-Opening invetory of finished goods	1725	1875	2175	2025	7800
No. of units to be produced	11650	12800	14350	13400	52200