6 Required:Prepare a sales forecast by product and in total for Audio-2-Go, Inc., for this year.Audio-2-Go, Inc.Sales BudgetFor This YearModelPriceTotal SalesA-1A-2A-3A-4A-5A-6TotalUnits1000 Sales Forecast and BudgetAudio-2-Go, Inc., manufactures MP3 players. Models A-1, A-2, and A-3 are small and light. They are attached to armbands and use flashmemory. Models A-4 and A-5 are somewhat larger and use a built-in hard drive; they can be put into fanny packs for use while working out.It is now early January, and Audio-2-Go's budgeting team is finalizing the sales budget for this year. Sales in units and dollars for last yearwere as follows:ModelNumber SoldPriceRevenueA-119,000$ 50$950,000A-230,000802,400,000A-356,0001106,160,000A-412,0001401,680,000A-52,500230575,000$11,765,000In looking over the last year's sales figures, Audio-2-Go's sales budgeting team recalled the following:a. Model A-1 costs were rising faster than the price could rise. Preparatory to phasing out this model, Audio-2-Go, Inc., planned to slashadvertising for this model and raise its price by 20 percent. The number of units of Model A-1 to be sold was forecast to be 50 percent oflast year's units.b. Model A-5 was introduced on November 1 of last year. It contains a built-in 20 GB hard drive and can be synchronized with severalpopular music software programs. Audio-2-Go brought out this model to match competitors' audio players, but the price is so much higherthan other Audio-2-Go products, that sales have been disappointing. The company plans to discontinue this model on June 30 of this year,and thinks that monthly sales will remain at last year's level if the sales price remains unchanged.c. Audio-2-Go plans to introduce Model A-6 on July 1 of this year. It will be a high-end player that will be lighter and more versatile thanModel A-5 (which it will replace). The target price for this model is $190; unit sales are estimated to equal 4,000 per month.d. A competitor has announced plans to introduce an improved version of Model A-3. Audio-2-Go believes that the Model A-3 price must becut 15 percent to maintain unit sales at last year's level.e. It was assumed that unit sales of all other models would increase by 10 percent, prices remaining constant.

The forecasted sales budget is prepared by the management by considering its past recorded sales…

Answered: Prepare a sales forecast by product and…

Prepare a sales forecast by product and in total for Audio-2-Go, Inc., for this year. Audio-2-Go, Inc. Sales Budget For This Year Model Price Total Sales A-1 A-2 A-3 A-4 A-5 A-6 Total Units

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter8: Budgeting For Planning And Control

Section: Chapter Questions

Problem 18E: Audio-2-Go, Inc., manufactures MP3 players. Models A-1, A-2, and A-3 are small and light. They are...

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Sales Forecast and Budget Audio-2-Go, Inc., manufactures MP3 players. Models A-1, A-2, and A-3 are small and light. They are attached to armbands and use flash memory. Models A-4 and A-5 are somewhat larger and use a built-in hard drive; they can be put into fanny packs for use while working out. It is now early January, and Audio-2-Go’s budgeting team is finalizing the sales budget for this year. Sales in units and dollars for last year were as follows: Model Number Sold Price Revenue A-1 24,000 $ 60 $1,440,000 A-2 40,000 75 3,000,000 A-3 55,000 100 5,500,000 A-4 12,000 120 1,440,000 A-5 3,000 240 720,000 $12,100,000 In looking over the last year's sales figures, Audio-2-Go’s sales budgeting team recalled the following: Model A-1 costs were rising faster than the price could rise. Preparatory to phasing out this model, Audio-2-Go, Inc., planned to slash advertising for this model and…
Audio-2-Go, Inc., manufactures MP3 players. Models A-1, A-2, and A-3 are small and light. They are attached to armbands and use flash memory. Models A-4 and A-5 are somewhat larger and use a built-in hard drive; they can be put into fanny packs for use while working out. It is now early January, and Audio-2-Go’s budgeting team is finalizing the sales budget for this year. Sales in units and dollars for last year were as follows: Model Number Sold Price Revenue A-1 23,000 $ 50 $1,150,000 A-2 38,000 85 3,230,000 A-3 55,000 100 5,500,000 A-4 13,000 120 1,560,000 A-5 4,500 220 990,000 $12,430,000 In looking over the last year's sales figures, Audio-2-Go’s sales budgeting team recalled the following: Model A-1 costs were rising faster than the price could rise. Preparatory to phasing out this model, Audio-2-Go, Inc., planned to slash advertising for this model and raise its price by 30 percent.…
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