Kraft Bakeries introduced in 2016 a new line of frozen apple

Kraft Bakeries introduced in 2016 a new line of frozen apple pie. For 2016, sales by quarter were as follows: 17,000 units; 22,100 units; 20,500 units; and 25,600 units. Because of aggressive marketing and promotion, the company expects that sales for each quarter of 2017 will be 25% higher than the respective quarter in 2016. The selling price per unit in 2017 is expected to be $4.20.

What are the expected sales, in units and dollars, for the second quarter of 2017? For the third quarter of 2017?

Solution

Quarter 2 2017 -

Expected sales in unti = 22,100 * (1+0.25) = 27,625

Selling Price = $4.20

Expected sales($) = $116,025

Quarter 3 2017 -

Expected sales in unti = 20,500 * (1+0.25) = 25,625

Selling Price = $4.20

Expected sales($) = $107,625