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A company sells a product for $3. The company prepares a flexible budget at two sales volumes. At a sales volume of 50 units, budgeted sales will be $. At a sales volume of 60 units, budgeted sales will be $.

Question

A company sells a product for 3.Thecompanypreparesaflexiblebudgetattwosalesvolumes.Atasalesvolumeof50units,budgetedsaleswillbe3. The company prepares a flexible budget at two sales volumes. At a sales volume of 50 units, budgeted sales will be . At a sales volume of 60 units, budgeted sales will be $.

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Solution

To calculate the budgeted sales, you need to multiply the sales volume by the price per unit.

Step 1: Calculate budgeted sales for 50 units The price per unit is 3.So,ifthecompanysells50units,thebudgetedsaleswillbe50units3. So, if the company sells 50 units, the budgeted sales will be 50 units * 3/unit = $150.

Step 2: Calculate budgeted sales for 60 units Similarly, if the company sells 60 units, the budgeted sales will be 60 units * 3/unit=3/unit = 180.

So, at a sales volume of 50 units, budgeted sales will be 150.Atasalesvolumeof60units,budgetedsaleswillbe150. At a sales volume of 60 units, budgeted sales will be 180.

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