forecast Sales Volume and Sales BudgetSentinel Systems Inc. prepared the following sales budget for 20Y8:Sentinel Systems Inc.Sales BudgetFor the Year Ending December 31, 20Y8Product and AreaUnit SalesVolumeUnit SellingPriceTotal SalesHome Alert System:United States1,700$200$ 340,000Europe580200116,000Asia45020090,000Total 2,730$ 546,000Business Alert System:United States980$750$ 735,000Europe350750262,500Asia240750180,000Total 1,570$1,177,500Total revenue from sales$1,723,500At the end of December 20Y8, the following unit sales data were reported for the year:Unit SalesHome AlertSystemBusiness AlertSystemUnited States1,7341,078Europe609329 Asia432252 For the year ending December 31, 20Y9, unit sales are expected to follow the patterns established during the year ending December 31, 20Y8. The unit selling price for the Home Alert System is expected to increase to $250, and the unit selling price for the Business Alert System is expected to be increased to $820, effective January 1, 20Y9.Required:1. Compute the increase or decrease of actual unit sales for the year ended December 31, 20Y8, over budget.Enter any decreases beginning with a minus (-) sign. Unit Sales,Year Ended 20Y8Increase (Decrease) Actual Over BudgetBudgetActual SalesAmountPercentHome Alert System:United States %Europe %Asia %Business Alert System:United States %Europe %Asia %2. Assuming that the increase or decrease in actual sales to budget indicated in part (1) is to continue in 20Y9, compute the unit sales volume to be used for preparing the sales budget for the year ending December 31, 20Y9. Enter any decreases beginning with a minus (-) sign. Round budgeted units to the nearest whole unit.20Y8ActualUnitsPercentageIncrease(Decrease)20Y9BudgetedUnits (rounded)Home Alert System:United States % Europe % Asia % Business Alert System:United States % Europe % Asia % 3. Prepare a sales budget for the year ending December 31, 20Y9.Sentinel Systems Inc.Sales BudgetFor the Year Ending December 31, 20Y9Product and AreaUnit Sales VolumeUnit Selling PriceTotal SalesHome Alert System: United States $$Europe Asia Total $Business Alert System: United States $$Europe Asia Total $Total revenue from sales $
Master Budget
A master budget can be defined as an estimation of the revenue earned or expenses incurred over a specified period of time in the future and it is generally prepared on a periodic basis which can be either monthly, quarterly, half-yearly, or annually. It helps a business, an organization, or even an individual to manage the money effectively. A budget also helps in monitoring the performance of the people in the organization and helps in better decision-making.
Sales Budget and Selling
A budget is a financial plan designed by an undertaking for a definite period in future which acts as a major contributor towards enhancing the financial success of the business undertaking. The budget generally takes into account both current and future income and expenses.
Sentinel Systems Inc. prepared the following sales budget for 20Y8:
Sentinel Systems Inc.
Sales Budget
For the Year Ending December 31, 20Y8
Product and Area
Unit Sales
Volume
Unit Selling
Price
Total Sales
Home Alert System:
United States
1,700
$200
$ 340,000
Europe
580
200
116,000
Asia
450
200
90,000
Total
2,730
$ 546,000
Business Alert System:
United States
980
$750
$ 735,000
Europe
350
750
262,500
Asia
240
750
180,000
Total
1,570
$1,177,500
Total revenue from sales
$1,723,500
At the end of December 20Y8, the following unit sales data were reported for the year:
Unit Sales
Home Alert
System
Business Alert
System
United States
1,734
1,078
Europe
609
329
Asia
432
252
For the year ending December 31, 20Y9, unit sales are expected to follow the patterns established during the year ending December 31, 20Y8. The unit selling price for the Home Alert System is expected to increase to $250, and the unit selling price for the Business Alert System is expected to be increased to $820, effective January 1, 20Y9.
Required:
1. Compute the increase or decrease of actual unit sales for the year ended December 31, 20Y8, over budget.
Enter any decreases beginning with a minus (-) sign.
Unit Sales,
Year Ended 20Y8
Increase (Decrease)
Actual Over Budget
Budget
Actual Sales
Amount
Percent
Home Alert System:
United States
%
Europe
%
Asia
%
Business Alert System:
United States
%
Europe
%
Asia
%
2. Assuming that the increase or decrease in actual sales to budget indicated in part (1) is to continue in 20Y9, compute the unit sales volume to be used for preparing the sales budget for the year ending December 31, 20Y9.
Enter any decreases beginning with a minus (-) sign. Round budgeted units to the nearest whole unit.
20Y8
Actual
Units
Percentage
Increase
(Decrease)
20Y9
Budgeted
Units (rounded)
Home Alert System:
United States
%
Europe
%
Asia
%
Business Alert System:
United States
%
Europe
%
Asia
%
3. Prepare a sales budget for the year ending December 31, 20Y9.
Sentinel Systems Inc.
Sales Budget
For the Year Ending December 31, 20Y9
Product and Area
Unit Sales Volume
Unit Selling Price
Total Sales
Home Alert System:
United States
$
$
Europe
Asia
Total
$
Business Alert System:
United States
$
$
Europe
Asia
Total
$
Total revenue from sales
$
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