Rachel Janet is preparing the 2024 budget for one of BestKayak's roto-moulded kayaks. Extensive meetings with members
Question:
Rachel Janet is preparing the 2024 budget for one of BestKayak's roto-moulded kayaks. Extensive meetings with members of the sales department and executive team have resulted in the following unit sales projections for 2024.
Jan | Feb | Mar | Apr | May | Jun | Jul | Aug | Sep | Oct | Nov | Dec |
400 | 450 | 680 | 810 | 900 | 1100 | 1250 | 1000 | 500 | 400 | 300 | 1000 |
Selling price is $540. For promotion activities, BestKayak's gives a 10% discount on selling price in September and December. All sales are on credit. The company expects that it can collect 20% of sales in the month of sales, 50% of sales in the next month, and the remaining 30% in second month.
Sales in November 2023 totaled to 250 units at the selling price of$540and in December 2023 to 1000 units at the 10% discount selling price.
BestKayaks' policy is to have finished goods ending inventory in a month equal to20%of the next month's anticipated sales. This policy also applied to ending inventory of finished goods on December 31, 2023.
Preliminary sales projections for 2025 are 550 units for January and 420 for February.
1. What are the budgeted total sales for the year 2024?
Managerial Accounting Tools for Business Decision Making
ISBN: 978-1118856994
4th Canadian edition
Authors: Jerry J. Weygandt, Paul D. Kimmel, Donald E. Kieso, Ibrahim M. Aly