ABC Company has a policy of maintaining an inventory of finished goods equal to 25% of the following month's sales units. For the forthcoming month of June, the budgeted beginning inventory is at 20,000 units and the ending inventory at 22,000 units. The following are the budgeted sales for the months of August to October October August 90,000 September 92,000 94,500 The sales price the finished goods per unit is P150 based on gross profit rate (on cost) of 15%. October ending inventory is estimated to be at 20% less than September's. Operating expenses were estimated as follow: ● Selling expense is at 2.75% of sales Salary expense is at P5,000 + 3% of sales ● General and Administrative Expense is at P40,000 per month

Cornerstones of Cost Management (Cornerstones Series)
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Chapter8: Budgeting For Planning And Control
Section: Chapter Questions
Problem 15E: Palmgren Company produces consumer products. The sales budget for four months of the year is...
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dgeting Activity-03/25/ x +
ses/115610/quizzes/1740321/take
ABC Company has a policy of maintaining an inventory of finished goods equal to 25% of the following
month's sales units. For the forthcoming month of June, the budgeted beginning inventory is at
20,000 units and the ending inventory at 22,000 units.
The following are the budgeted sales for the months of August to October
August
90,000
September
92,000
October
94,500
The sales price the finished goods per unit is P150 based on gross profit rate (on cost) of 15%.
October ending inventory is estimated to be at 20% less than September's.
Operating expenses were estimated as follow:
Seling expense is at 2.75% of sales
Salary expense is at P5,000 + 3% of sales
General and Administrative Expense is at P40,000 per month
Number of units available for sale for the month of July
Format XXX,XXX i.e. 123,850
Question 4
Transcribed Image Text:dgeting Activity-03/25/ x + ses/115610/quizzes/1740321/take ABC Company has a policy of maintaining an inventory of finished goods equal to 25% of the following month's sales units. For the forthcoming month of June, the budgeted beginning inventory is at 20,000 units and the ending inventory at 22,000 units. The following are the budgeted sales for the months of August to October August 90,000 September 92,000 October 94,500 The sales price the finished goods per unit is P150 based on gross profit rate (on cost) of 15%. October ending inventory is estimated to be at 20% less than September's. Operating expenses were estimated as follow: Seling expense is at 2.75% of sales Salary expense is at P5,000 + 3% of sales General and Administrative Expense is at P40,000 per month Number of units available for sale for the month of July Format XXX,XXX i.e. 123,850 Question 4
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