Answer:
Sonic Inc.
a) Sales Budget:
Rumble Thunder
Total units sold 8,550 7,450
Unit sales price $135 $210
Sales value $1,154,250 $1,564,500
b) Production Budget:
Rumble Thunder
Total units sold 8,550 7,450
Desired inventory (units), June 30 299 56
Estimated inventory (units), June 1 260 64
Units to be produced 8,589 7,442
Explanation:
a) Data and Calculations:
Rumble Thunder
Total units sold 8,550 7,450
Desired inventory (units), June 30 299 56
Estimated inventory (units), June 1 260 64
Units Produced 8,589 7,442
Rumble Thunder
Expected sales volume (units):
Midwest Region 3,650 3,200
South Region 4,900 4,250
Total units sold 8,550 7,450
Unit sales price $135 $210
a) The Sonic Inc.'s sales budget determines the production budget. When the quantity to be sold is obtained, then production planning can take place based on meeting customers' demand for goods or services.
b) The Production budget is a bye-product of the sales budget, though, it is critical in the whole value chain. It is the production budget that guides production planning, including the type, design, and other features of the product.
