Ratchet Manufacturing's August sales budget calls for sales of 8,000 units. Each month's sales are expected to exceed the prior month's results by 5%. The product selling price is $25 per unit. The expected total sales dollars for September's sales budget are:

Question

Quizplus · Accepted Answer

To calculate the expected total sales dollars for September's budget, we need to use the given information that each month's sales are expected to exceed the prior month's results by 5%.

So, to find September's sales, we first need to calculate the August sales increased by 5%:
August Sales = 8,000 units x $25 per unit = $200,000
September Sales = August Sales + (August Sales x 5%) 
September Sales = $200,000 + ($200,000 x 0.05) 
September Sales = $210,000

Therefore, the expected total sales dollars for September's sales budget are $210,000. Hence, the correct answer is D.

Ratchet Manufacturing's August Sales Budget Calls for Sales of 8,000