 here again what we're doing is we're saying I'm taking this 400 times 1.03, 103% 1.03 that gives us the 412 times the 700 unit price so so we don't really need to calculate May but if we wanted to we can say okay May is 400 units times 700 per unit enter that comes out to 280 sales and then June is going to go up to 214 412 units times 700 per unit and that gives us the 288 for now what we're looking for this is the sales and what we're looking for is the the selling expenses so they they're telling us that the selling expenses is 3% of sales we have commission commission rate is going to be 3% so once again that's point or 2% sorry it's 2% 0.02 so I'm going to go back on there on that 0.02 I'm going to go to the home tab we're going to go to the numbers group and again I could increase the decimals 0.02 is the same as if I say the percent sign 2% and that means that the commission will be the sales of 288 4 times 2% times 0.02 in the calculator and that'll give us the commission of this 5768 we also pay a salary so we have a salary a sales salary to the sales manager of 3000 therefore the total sales then would be the selling expense would be the commission 5768 plus the salary that we pay them and that will give us the 8768 for the selling expenses so note that the problem the main issue with this type of problem is to basically format the the information put it down in a format that works obviously an excel it's nice because you can move things around if you don't have excel then you need to get used to how to format different types of problems so you can do it efficiently by hand it would be the same type of thing graph like this but you want to be able to efficiently do that by hand all right next one here once again I'm going to try to start off by reading that last line first to see if we can get some information on what needs to be done before we read through the entire thing so the last line begins right here with budgeted purchases of product a for the year would be so we need to find out what what the budgeted purchases of a will be so keep that in mind as we read through the entire thing here starting from the top we have the sales budget for corp shows 20,200 units of product a and 20,200 units of product b are going to be sold for prices of $10 and 20 cents and $12 and 20 cents respectively the desired ending inventory of product a is 30 percent higher than its beginning inventory of 2200 units the beginning inventory product b is 2700 units the desired inventory inventory is 3200 okay so we're going to try to focus in on product a so we need to figure out what we need to purchase now when we think about what we need to purchase we have to start off that that conversation out with how much do we think we're going to sell how much do we think we're going to sell with product a throughout the year so projected sales of product a because that's what we're focusing on here is 20,200 units 20,200 so that's how much we need 20,200 units now that if that was it if we were starting from nowhere that's how much that's how much we would have to basically purchase or produce if we wanted to sell that much but this is not our first year for one which means that we have beginning inventory already so we don't have to have the whole 20,200 because we already have some in beginning inventory and it's also true that we want to basically a cushion at the end so we want a desired ending inventory and so so we want something at the end and what will that desired ending inventory be now they're gonna they're gonna give us the beginning number work that's what we'll typically know and then we're gonna basically calculate off that what the desired ending is so they tell us that here the desired ending inventory of product a is 30 percent higher than its beginning inventory so I'm going to do that in a separate calculation we're going to say the beginning inventory is 2200 2200 and we want it to be 30 higher because it's going to be a 30 percent higher for the ending inventory so that would be 0.3 30 percent or if we go to the home tab I'm going to add some decimals it's 0.3 that would be 30 percent or if we hit the percent sign 30 percent same thing that means that we want an increase of 2200 times 30 percent and that will give us the increase of 660 that's the amount of the increase so what's the ending balance going to be then we want it to be this 2200 plus the increase the 30 percent increase of 660 now once again we could do that quicker we could do that quicker we could say okay the beginning inventory is 2200 2200 times not 30 percent but 100 plus 30 1.3 1.3 and if we go to the home tab numbers and we add decimals it's 1.30 1.3 is the same as if we make it a percent the 130 percent and we do that with one calculation then we're gonna just say okay I want this 2200 times the original 100 plus the 30 130 and that will bring us to the 2008 60 so if we were starting at a point of zero we don't have any any we don't have any inventory we would need to produce the projected sales in units 2200 and we would have to produce enough to have our desired ending inventory which in this case happens to be the beginning inventory I'm just going to recalculate it here 2200 times 1.3 130 percent enter so there's there's that okay and then that's what we would have if we didn't have something in there already but we already have a beginning balance we already have a beginning balance and we're going to subtract that out so if we didn't have any beginning balance we would have to have the 2200 plus this much for a cushion at the end but there's already something in there in the beginning so we're going to say minus the 2200 that's in there at the beginning so if we sum that up then we're going to say what we need to produce then is going to be this 2200 plus what we want at the end minus what's already in there and that will be the 2008 60 if we did that in a calculator all we're doing there would be of course taking the 2200 plus the 2860 minus 2200 giving us the 20860