Check my The marketi account) ng department of Jessi Corporation has submfted th
ID: 2396089 • Letter: C
Question
Check my The marketi account) ng department of Jessi Corporation has submfted the following sales forecast for the upcoming fiscal year (all sales are on 1st Quarter 2nd Quarter 3rd Quarter 4th Quarter 13,300 Budgeted unit sales 11,380 12,300 14,300 The selling price of the company's product is $12 per unit. Management 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 $70,800. The company expects to start the first quarter with 1,695 units in finished goods inventory Management desires an ending finished good inventory each quarter equal to 15% of the next quarter's budgeted sales. The desired ending finished goods inventory for the fourth quärter is 1,895 units Required: 1. Calculate the estimated sales for each qdärter 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 Dell Update 1 update is ready t Details Required 1 Required 2Required 3 Pre 2 of 4 Next> Install nowExplanation / Answer
Req 1 1st Quarter 2nd Quarter 3rd Quarter 4th Quarter Year Budgeted unit sales 11,300 12,300 14,300 13,300 51,200 Selling price per unit x $12 x $12 x $12 x $12 x $12 Total sales $ 135,600 $ 147,600 $ 171,600 $ 159,600 $ 614,400 Req 2 Jessi Corporation Schedule of Expected Cash Collections 1st Quarter 2nd Quarter 3rd Quarter 4th Quarter Year Accounts receivable, $ 70,800 $ 70,800 beginning balance 1st Quarter sales(75%/20%) $ 101,700 $ 27,120 $ 128,820 2nd Quarter sales(75%/20%) $ 110,700 $ 29,520 $ 140,220 3rd Quarter sales(75%/20%) $ 128,700 $ 34,320 $ 163,020 4th Quarter sales(75%/20%) $ 119,700 $ 119,700 Total cash collections $ 172,500 $ 137,820 $ 158,220 $ 154,020 $ 622,560 Note that collections in the quarter of sales is 75%, therefore for the first quarter $135,600 × 75% = $101,700 In the quarter following the sale, collections are expected to be 20%, therefore $135,600 × 20% = $27,120, The rest of the calculations are done the same way Jessi Corporation Production Budget 1st Quarter 2nd Quarter 3rd Quarter 4th Quarter Year Budgeted unit sales 11,300 12,300 14,300 13,300 51,200 Add desired ending inventory-15% of next qtr sales 1845 2145 1995 1895 1895 Total units needed 13,145 14,445 16,295 15,195 53,095 Less beginning inventory 1695 1845 2145 1995 1695 Required production 11,450 12,600 14,150 13,200 51,400