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Forecast Sales Volume and Sales Budget

For 20Y6, Raphael Frame Company prepared the sales budget that follows.

At the end of December 20Y6, the following unit sales data were reported for the year:

	Unit Sales
	8" 10" Frame		12" 16" Frame
East	30,765		15,688
Central	7,519		3,920
West	6,499		2,884

Raphael Frame Company Sales Budget For the Year Ending December 31, 20Y6
Product and Area		Unit Sales Volume		Unit Selling Price		Total Sales
8" 10" Frame:
East		29,300		$33		$966,900
Central		7,300		33		240,900
West		6,700		33		221,100
Total		43,300				$1,428,900
12" 16" Frame:
East		14,800		$34		$503,200
Central		4,000		34		136,000
West		2,800		34		95,200
Total		21,600				$734,400
Total revenue from sales						$2,163,300

For the year ending December 31, 20Y7, unit sales are expected to follow the patterns established during the year ending December 31, 20Y6. The unit selling price for the 8" 10" frame is expected to increase to $34 and the unit selling price for the 12" 16" frame is expected to increase to $36, effective January 1, 20Y7.

Required:

1. Compute the increase or decrease of actual unit sales for the year ended December 31, 20Y6, over budget. Use the minus sign to indicate a decrease in amount and percent. Round percents to the nearest whole percent.

		Unit Sales, Year Ended 20Y6				Increase (Decrease) Actual Over Budget
		Budget		Actual Sales		Amount	Percent
8" 10" Frame:
	East						%
	Central						%
	West						%
12" 16" Frame:
	East						%
	Central						%
	West						%

2. Assuming that the increase or decrease in actual sales to budget indicated in part (1) is to continue in 20Y7, compute the unit sales volume to be used for preparing the sales budget for the year ending December 31, 20Y7. Use the minus sign to indicate a decrease in percent. Round budgeted units to the nearest whole unit.

		20Y6 Actual Units		Percentage Increase (Decrease)	20Y7 Budgeted Units (rounded)
8" 10" Frame:
	East			%
	Central			%
	West			%
12" 16" Frame:
	East			%
	Central			%
	West			%

Feedback

To calculate the difference subtract budget from actual sales.

3. Prepare a sales budget for the year ending December 31, 20Y7.

Raphael Frame Company
Sales Budget
For the Year Ending December 31, 20Y7
Product and Area	Unit Sales Volume	Unit Selling Price	Total Sales
8" 10" Frame:
East		$	$
Central
West
Total			$
12" 16" Frame:
East		$	$
Central
West
Total			$
Total revenue from sales			$

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