Question

Navigator sells GPS trackers for $50 each. It expects sales of 5,000 units in quarter 1 and a 5% increase each subsequent quarter for the next 8 quarters. Prepare a sales budget by quarter for the first year. What is the amount of total sales revenue for the year?

Answer 1

Answer and Explanation:

The Preparation of the sales budget and the computation of the amount of total sales revenue for the year is shown below:-

Sales Budget For Year 1

Quarter Number of Sale price (B) Sales Revenue

Units (A) (A) × (B)

1 5,000 $50 $250,000

2 5,250 $50 $262,500

(5,000 × 105%)

3 5,513 $50 $275,650

(5,250 × 105%)

4 5,789 $50 $289,450

(5,513 × 105%)

Total $1,077,600