Financial & Managerial Accounting
13th Edition
ISBN: 9781285866307
Author: Carl Warren, James M. Reeve, Jonathan Duchac
Publisher: Cengage Learning
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Textbook Question
Chapter 21, Problem 21.1APR
For 2016, Raphael Frame Company prepared the .sales budget that follows.
At the end of December 2016, the following unit sales data were reported for the year.
| Unit Sales | ||
| 8" × 10" Frame | 12" × 16" Frame | |
| East | 8,755 | 3,686 |
| Central | 6,510 | 3,090 |
| West | 12,348 | 5,616 |
For the year ending December 31, 2017, unit sales are expected to follow die patterns established during the year ending December 31, 2016. The unit selling price for the 8" × 10" frame is expected to increase to $17 and die unit selling price for die 12" × 16" frame is expected to increase to $32, effective January 1, 2017.
Instructions
1. Compute the increase or decrease of actual unit sales for the year ended December 31, 2016, over budget. Place your answers in a columnar table with the following format:
| Unit Sales, Year Ended 2016 | Increase (Decrease) Actual Over Budget | |
| Budget Actual Sales | Amount Percent | |
| 8" × 10" Frame: | ||
| East | ||
| Central | ||
| West | ||
| 12"× 16" Frame: | ||
| East | ||
| Central | ||
| West |
2. Assuming that the increase or decrease in actual sales to budget indicated in part (1) is to continue in 2017, compute the unit sales volume to be used for preparing the sales budget for the year ending December 31, 2017. Place your answers in a columnar table similar to that in part (1) but with the following column heads. Round budgeted units to the nearest unit.
| 2016 Actual Units | Percentage Increase (Decrease) | 2017 Budgeted Units (rounded) |
3. Prepare a sales budget for the year ending December 31, 2017.
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Forecast Sales Volume and Sales Budget
For 20Y8, Raphael Frame Company prepared the sales budget that follows.
At the end of December 20Y8, the following unit sales data were reported for the year:
For 20Y6, Raphael Frame Company prepared the sales budget that follows.
At the end of December 20Y6, the following unit sales data were reported for the year:
Unit Sales
8" x 10"
12" x 16"
Frame
Frame
East
24,440
14,910
Central
6,222
4,018
West
5,432
3,060
Raphael Frame Company
Sales Budget
For the Year Ending December 31, 20Y6
Unit
Unit Sales
Selling
Product and Area
Volume
Price
Total Sales
8" x 10" Frame:
East
23,500
$24
$564,000
Central
6,100
24
146,400
West
5,600
24
134,400
Total
35,200
$844,800
12" x 16" Frame:
East
14,200
$34
$482,800
Central
4,100
34
139,400
West
3,000
34
102,000
Total
21,300
$724,200
Total revenue from sales
$1,569,000
Förecast Sales volume and
Budget
For 20Y8, Raphael Frame Company prepared the sales budget that follows.
At the end of December 20Y8, the following unit sales data were reported for the year:
Unit Sales
8" x 10"
12" x 16"
Frame
Frame
East
20,394
15,496
Central
5,353
6,272
West
4,850
5,304
Raphael Frame Company
Sales Budget
For the Year Ending December 31, 20Y8
Unit
Unit Sales
Product and Area
Selling
Total Sales
Volume
Price
8" x 10" Frame:
East
19,800
$31
$613,800
Central
5,300
31
164,300
West
5,000
31
155,000.
Total
30,100
$933,100
12" x 16" Frame:
East
14,900
$32
$476,800
Central
6,400
32
204,800
West
5,200
32
166,400
Total
26.500
$848.000
Chapter 21 Solutions
Financial & Managerial Accounting
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