Tilson Company Has Projected Sales and Production in Units for the Second

question 56

Essay

Tilson Company has projected sales and production in units for the second quarter of the coming year as follows:
$\begin{array}{|l|r|r|r|}\hline & \text { Apri } & \text { May } & \text { June } \\\hline \text { Sales } & 55,000 & 45,000 & 65,000 \\\hline \text { Production } & 65,000 & 55,000 & 55,000 \\\hline\end{array}$ Cash-related production costs are budgeted at $7 per unit produced.Of these production costs,40% are paid in the month in which they are incurred and the balance in the following month.Selling and administrative expenses will amount to $110,000 per month.The accounts payable balance on March 31 totals $193,000,which will be paid in April.
All units are sold on account for $16 each.Cash collections from sales are budgeted at 60% in the month of sale,30% in the month following the month of sale,and the remaining 10% in the second month following the month of sale.Accounts receivable on April 1 totalled $520,000 ($100,000 from February's sales and the remainder from March).
Required:
a)Prepare a schedule for each month showing budgeted cash disbursements for Tilson Company.
b)Prepare a schedule for each month showing budgeted cash receipts for Tilson Company.

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Definitions:

Marketing Strategies

Comprehensive plans formulated to reach marketing goals, such as increasing brand awareness or market share, through a coordinated set of actions involving product, price, place, and promotion.

Four Ps

The Four Ps refer to Product, Price, Place, and Promotion, a marketing mix model that companies use to consider and adjust their marketing strategy and approach to market effectively.

Price

The amount of money that must be paid to acquire a good or service.

Introductory Offer

A promotional strategy involving a temporary low price or additional benefits to attract new customers or introduce a new product.