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16 April, 04:21

At January 1, 2016, Deer Corp. has beginning inventory of 2,000 surfboards. Deer estimates it will sell 10,000 units during the first quarter of 2016 with a 12% increase in sales each quarter. Deer's policy is to maintain an ending inventory equal to 25% of the next quarter's sales. Each surfboard costs $100 and is sold for $150. How much is budgeted sales revenue for the third quarter of 2016?

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  1. 16 April, 07:48
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    Sales revenue = $1,881,600

    Explanation:

    Giving the following information:

    Deer estimates it will sell 10,000 units during the first quarter of 2016 with a 12% increase in sales each quarter. Each surfboard costs $100 and is sold for $150.

    Sales:

    First quarter = 10,000

    Second quarter = 10,000*1.12 = 11,200

    Third quarter = 11,200*1.12 = 12,544

    Sales revenue = 12,544*150 = $1,881,600
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Home » Business » At January 1, 2016, Deer Corp. has beginning inventory of 2,000 surfboards. Deer estimates it will sell 10,000 units during the first quarter of 2016 with a 12% increase in sales each quarter.
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