Transcribed Image Text: ABC Company is preparing its master budget for 2014. Relevant data pertaining to its sales, I production, and direct materials budgets are as follows. Sales. Sales for

Transcribed Image Text: ABC Company is preparing its master budget for 2014. Relevant data pertaining to its sales,
I
production, and direct materials budgets are as follows.
Sales. Sales for the year are expected to total 1,200,000 units. Quarterly sales, as a percentage of
total sales, are 20%, 25%, 30%, and 25%, respectively. The sales price is expected to be 50 per
unit for the first three quarters and 55 per unit beginning
in the fourth quarter. Sales in the first quarter of 2015 are expected to be 10% higher than the
budgeted sales for the first quarter of 2014.
Production. Management desires to maintain the ending finished goods inventories at 25% of the
next quarter’s budgeted sales volume.
Prepare the sales and production budgets by quarters for the year ending December 31, 2014.

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