Abc company’s actual unit sales in the current year for january, february, and march was 16,100, 13,100, and 19,100 units, respectively. current year selling price is $40. an analysis of general economic trends and specific initiatives at abc forecasts increases for the coming budget year: sales volume by 10% and sales price by 5%.
required:
prepare abc company’s budgeted unit sales and total sales volume for the first quarter of the coming year.

Budgeted units sales=53,130 unit sales

total sales volume=53,130×42=$2,231,460

Explanation:

Step 1

Determine the forecasted units for January, February and March as follows;

January forecasted units sales=initial units+increase in unit sales

where;

initial units=16,100

increase in unit sales=10% of 16,100=(10/100)×16,100=1,610

replacing;

January forecasted units sales=(16,100+1,610)=17,710 units

February forecasted units sales=initial units+increase in unit sales

where;

initial units=13,100

increase in unit sales=10% of 13,100=(10/100)×13,100=1,310

replacing;

February forecasted units sales=(13,100+1,310)=14,410 units

March forecasted units sales=initial units+increase in unit sales

where;

initial units=19,100

increase in unit sales=10% of 19,100=(10/100)×19,100=1,910

replacing;

February forecasted units sales=(19,100+1,910)=21,010 units

Forecasted price per unit=Initial price+increase in price

where;

initial price=$40

increase in price=(5/100)×40=$2

replacing;

forecasted price per unit=40+2=$42

Budgeted units sales=(17,710+14,410+21,010)=53,130 unit sales

Total sales volume=unit sales×price per unit

total sales volume=53,130×42=$2,231,460

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