Question

Mary's Baskets Company expects to manufacture and sell 24 comma 000 baskets in 2019 for $ 7 each. There are 2 comma 000 baskets in beginning finished goods inventory with target ending inventory of 2 comma 000 baskets. The company keeps no workminusinminusprocess inventory. What amount of sales revenue will be reported on the 2019 budgeted income​ statemen

Answer 1

Answer:

The budgeted sales revenue is : $168,000

Explanation:

In 2019, as Mary's Basket Company has the opening Inventory balance of 2,000 baskets; projects to manufactures 24,000 baskets, plans to maintain ending inventory at $2,000 baskets without any work-in-process inventory; We have the baskets available for sales in the year of 2019 is:

  Actual Ending Balance of 2018 + Projected manufactured baskets during the year 2019 - Planned ending Balance of the year 2019 = 2,000 + 24,000 - 2,000 = 24,000

The unit price is projected at $7.

Thus, we have the projected sales revenue is:

  Projected Unit price x Projected baskets available for sales = 7 x 24,000 = $168,000