acc - 220 - week 7 dq 2 - unit sales volume for each...

Info icon This preview shows page 1. Sign up to view the full content.

View Full Document Right Arrow Icon
Some of the different types of budgets include sales, production, direct materials, budgeted income statement, capital expenditure budget, cash budget, and budgeted balance sheet. The sales budget is the initial budget arranged. All of the other budgets depend on the sales budget. The sales budget is derived from the sales forecast. It stands for management’s best estimate of sales revenue for the budget period. A mistaken sales budget might negatively affect net income. An overly optimistic sales budget might effect in excessive inventories that might have to be sold at reduced prices. In contrast, an unduly conservative budget might effect in loss of sales revenue due to inventory shortages. The sales budget is prepared by multiplying the expected
Image of page 1
This is the end of the preview. Sign up to access the rest of the document.

Unformatted text preview: unit sales volume for each product by its anticipated unit selling price. The Bricks Company, sales volume is expected to be 2,000 units in the first quarter, with 500-unit increments in each succeeding quarter. Based on a sales price of $50 per unit, the sales budget for the year, by quarters. Some businesses classify the projected sales revenue as cash or credit sales and by geographical regions, territories, or salespersons. An example of the Bricks Company Sales Budget below: Bricks Company Sales Budget Expected unit sales Quarter 1 2 3 4 Year 2,000 2,500 3,000 3,500 11,000 Unit selling price X 50 X 50 X 50 X 50 X 50 Total sales $100,000 $125,000 $150,000 $175,000 $550,000...
View Full Document

{[ snackBarMessage ]}

What students are saying

  • Left Quote Icon

    As a current student on this bumpy collegiate pathway, I stumbled upon Course Hero, where I can find study resources for nearly all my courses, get online help from tutors 24/7, and even share my old projects, papers, and lecture notes with other students.

    Student Picture

    Kiran Temple University Fox School of Business ‘17, Course Hero Intern

  • Left Quote Icon

    I cannot even describe how much Course Hero helped me this summer. It’s truly become something I can always rely on and help me. In the end, I was not only able to survive summer classes, but I was able to thrive thanks to Course Hero.

    Student Picture

    Dana University of Pennsylvania ‘17, Course Hero Intern

  • Left Quote Icon

    The ability to access any university’s resources through Course Hero proved invaluable in my case. I was behind on Tulane coursework and actually used UCLA’s materials to help me move forward and get everything together on time.

    Student Picture

    Jill Tulane University ‘16, Course Hero Intern