ACCT 556 help A Guide to career/Snaptutorial ACCT 556 help A Guide to career/Snaptutorial | Page 18

Pigment
two pounds per gallon
Direct labor rate
$8.25 per hour
two pounds per gallon
$8.25 per hour
2006 PROJECTED SALES INFORMATION
The sales department feels very good about the prospects for 2006.
The reputation of the new product, Stupendous Paint, has increased
significantly due to effective adverting in the past few years. The
sales department is ready to launch a major advertising campaign
which is expected to result in the trend of the last three year to
continue for the Stupendous brand even with a small price increase
per gallon.
Super Paint has been produced since the company began production.
The sales level of this product has been rather stagnant for the last 5
years, and that trend is expected to continue in the future.
You have made the following conclusions about the two different
products:
Super Paint
•
Sales growth in units will continue to be stagnant.
•
The more recent years are more representative of continuing
unit sales than years in the further past.
•
Exponential Smoothing will be an appropriate unit sales
projection method to use.
Stupendous Paint
•
Unit sales growth will continue on its current increasing trend
•
An exponential growth function with the year being the
independent variable and the sales volume being the dependent
variable will be an appropriate sales projection method.