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OBJECTIVE CORNERSTONE 8.2 Cornerstone Exercise 8.2 Production Budget Refer to Cornerstone Exercise 8.1...


OBJECTIVE CORNERSTONE 8.2 Cornerstone Exercise 8.2 Production Budget Refer to Cornerstone Exercise 8.1, through Requirement 1


OBJECTIVE 2 CORNERSTONE 8.2 Cornerstone Exercise 8.2 Production Budget bed r e amo Refer to Cornerstone Exercise 8.1, through


CORNERSTONE EXERCISES Cornerstone Exercise 8.1 Sales Budget Flash Kick Company manufactures and sells soccer balls for teams
Units Selling Price January February March April Units 50,000 58,000 80,000 100,000 Selling Price 58.75 $8.75 $8.78 $8.75 7,0
OBJECTIVE CORNERSTONE 8.2 Cornerstone Exercise 8.2 Production Budget Refer to Cornerstone Exercise 8.1, through Requirement 1. Flash Kick requires ending inventory of product to equal 20 percent of the next month's unit sales. Beginning inventory in January was 3,100 practice soccer balls and 400 match soccer balls. Required: I. Construct a production budget for each of the two product lines for Flash Kick Company for the first three months of the coming year. 2. What if Flash Kick wanted a production budget for the two product lines for the month of April? What additional information would you need to prepare this budget?
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CORNERSTONE EXERCISES Cornerstone Exercise 8.1 Sales Budget Flash Kick Company manufactures and sells soccer balls for teams of children in elementary and high school, Flash Kick's best-selling lines are the practice ball line (durable soccer balls for (continued)
Units Selling Price January February March April Units 50,000 58,000 80,000 100,000 Selling Price 58.75 $8.75 $8.78 $8.75 7,000 7.500 13,000 18,000 $16.00 $16.00 $16.00 S16.00 Required: 1. Construct a sales budget for Flash Kick for the first three months of the coming year. Show total sales for each product line by month and in total for the first quarter. 2. What if Flash Kick added a third line tournament quality soccer balls that were expected to take 40 percent of the units sold of the match balls and would have a selling price of $45 cach in January and February, and 548 each in March? Prepare a sales budget for Flash Kick for the first three months of the coming year. Show total sales for each product line by month and in total for the first quarter.
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Exercise 8.1 Sales Budget

1. Sales Budget for Flashkick for first three months:

Sales Budget of Flashkick for Quarter 1
January February March Quarter 1
Units Price Per unit Total Units Price Per unit Total Units Price Per unit Total Units Total
Practice Soccer Ball 50000          8.75    437,500.00 58000          8.75    507,500.00 80000          8.75        700,000.00 188000    1,645,000.00
Match Soccer Ball 7000        16.00    112,000.00 7500        16.00    120,000.00 13000        16.00        208,000.00 27500        440,000.00
57000    549,500.00 65500    627,500.00 93000        908,000.00 215500    2,085,000.00

2. Sales Budget with Product line 3 - Tournament quality Soccer Ball

Sales Budget of Flashkick for Quarter 1
January February March Quarter 1
Units Price Per unit Total Units Price Per unit Total Units Price Per unit Total Units Total
Practice Soccer Ball 50000          8.75    437,500.00 58000          8.75    507,500.00 80000          8.75        700,000.00 188000    1,645,000.00
Match Soccer Ball 7000        16.00    112,000.00 7500        16.00    120,000.00 13000        16.00        208,000.00 27500        440,000.00
Tournament quality Soccer Ball 2800        45.00    126,000.00 3000        45.00    135,000.00 5200        48.00        249,600.00 11000        510,600.00
59800    675,500.00 68500    762,500.00 98200    1,157,600.00 226500    2,595,600.00

Exercise 8.2 Production Budget:

1. Production budget for first three months:

Practice Soccer Ball Match Soccer Ball
January February March January February March
Budgeted Sales 50000 58000 80000 7000 7500 13000
Add: Desired Ending Inventory (20% of next month sales) 11600 16000 20000 1500 2600 3600
61600 74000 100000 8500 10100 16600
Less: Opening Inventory (Ending inventory of previous month becomes beginning inventory of current month) 3100 11600 16000 400 1500 2600
58500 62400 84000 8100 8600 14000

2. In order to prepare for April, Units sold for the month of May is required. Because in order to calculate ending inventory for April, which is equal to 20% of next month sales, May month details are required.

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