Veronica owns and operates a landscaping business, and she is creating a sales budget for July, which is next month. Veronica has had a good year and an even better summer thus far. She forecasts the following budgeted numbers: Sales volume of 350 (yards landscaped) with a budgeted selling price of $75 per yard that she services. Typically, Veronica is able to leave all of her customers satisfied, but she is going to budget an expected return/refund rate of 4% of sales and discounts of 1% of the original selling price for customers who remit payment promptly. What will the Budgeted Net Sales be for Veronica for July?
A) $24,937.50
B) $25,200.00
C) $25,987.50
D) $26,250.00

Question

Quizplus · Accepted Answer

To calculate Budgeted Net Sales, first calculate a Budgeted Gross Revenue, a Sales Returns amount, and a Sales Discounts value. Budgeted Gross Revenue equals 350 units times $75.00 per yard or $26,250.00. Next, calculate and subtract Sales Returns of $1,050.00 ($26,250.00 × 0.04) and Sales Discounts of $262.50 ($26,250.00 × 0.01). The Budgeted Net Sales value is $24,937.50 ($26,250.00 F1F1F1S1?F1F1F10 $1,050.00 F1F1F1S1?F1F1F10 $262.50).

Veronica Owns and Operates a Landscaping Business, and She Is