Sales and Production Budgets Vibrant 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 1 225 68 Desired inventory (units), June 30 259 59 Expected sales volume (units): North Region 2,150 1,900 South Region 5,250 5,950 Unit sales price $95 $190 a. Prepare a sales budget. Vibrant Inc.Sales BudgetFor the Month Ending June 30
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.
Sales and Production Budgets
Vibrant 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 | 225 | 68 | |
| Desired inventory (units), June 30 | 259 | 59 | |
| Expected sales volume (units): | |||
| North Region | 2,150 | 1,900 | |
| South Region | 5,250 | 5,950 | |
| Unit sales price | $95 | $190 |
a. Prepare a sales budget.
Product and Area |
Unit Sales Volume |
Unit Selling Price |
Total Sales |
| Model Rumble: | |||
| North Region | |||
| South Region | |||
| Total | |||
| Model Thunder: | |||
| North Region | |||
| South Region | |||
| Total | |||
| Total revenue from sales |
Once sales quantities are estimated, the expected sales revenue can be determined.
b. Prepare a production budget.
| Units Model Rumble |
Units Model Thunder |
|
| Expected units to be sold | ||
|
Plus desired inventory, June 30
|
||
| Total units required | ||
|
Less estimated inventory, June 1
|
||
| Total units to be produced |
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