Documents about Master Budget

  • 6 Pages

    Web Chapter 23

    University of Texas, ACC 310F

    Excerpt: ... Master Budget s and Planning Chapter 23 NOTE: Focus on all pages Master Budget Components Operating budgets - Sales budget - Purchases or production budget - Selling, general and administrative budget Capital expenditures budget Financial budgets - Cash budget - Budgeted income statement - Budgeted balance sheet Sales Budget Item: Year: iPhone 3G (8GB) 2008 Volume January 1 February March April 2 May June July 3 August September October 4 November December Total Price Total Merchandise Purchases Budget Budgeted sales for the period + Budgeted ending inventory Budgeted beginning inventory = Inventory to be purchased (or produced) ...

  • 1 Pages

    Chapter 6-Study Information

    Illinois State, ACC 230

    Excerpt: ... Accounting 230 Chapter 6 Study Information Horngren 13th Ed. 1. You should be able to define the following terms: budget, master budget , operating budgets, financial budgets, continuous (rolling budgets), kaizen budgeting, activitybased budgeting, responsibility accounting, controllable costs, and budgetary slack. 2. You should be able to list and discuss several of the advantages of budgets. 3. You should be able to discuss the time coverage of budgets. 4. You should know the order in which operating budgets are prepared. 5. You should be able to prepare, in good form, a sales budget, production budget, materials purchases budget in units and dollars, and a cash budget. 6. You should be able to describe what the managers of the following responsibility centers are responsible for: cost center, revenue center, profit center, and investment center. ...

  • 26 Pages

    im_ch09

    South Central College, ACC 210

    Excerpt: ... CHAPTER 9 Budgetary Planning ASSIGNMENT CLASSIFICATION TABLE Study Objectives 1. Indicate the benefits of budgeting. State the essentials of effective budgeting. Identify the budgets that comprise the master budget . Describe the sources for preparing the budgeted income statement. Explain the principal sections of a cash budget. Indicate the applicability of budgeting in nonmanufacturing companies. Questions 1, 2, 4 Brief Exercises Exercises A Problems B Problems 2. 3, 5, 6, 7, 8 3. 9, 10, 11, 12, 13, 14, 15, 16 17, 18 1, 2, 3, 4, 5, 6, 7 1, 2, 3, 4, 5, 6, 7, 8, 9 1A, 2A, 3A, 6A 1B, 2B, 3B 4. 8 9 1A, 2A, 3A, 6A 1B, 2B, 3B 5. 19, 20 9 10, 11, 12 4A, 6A 4B 6. 21, 22 10 11, 12, 13 5A 5B 9-1 ASSIGNMENT CHARACTERISTICS TABLE Problem Number 1A Description Prepare budgeted income statement and supporting budgets. Prepare sales, production, direct materials, direct labor, and income statement budgets. Prepare sales and production bu ...

  • 16 Pages

    Chapter 10

    Northwood, ACCOUNTING 232

    Excerpt: ... 23 Master Budget s and Planning Date: _ Class Notes Chapter 24 Flexible Budgets and Standard Costs Date: _ Class Notes Chapter 25 Capital Budgeting and Managerial Decisions Date: _ Class Notes ...

  • 3 Pages

    Web Chapter 23 Day 1

    University of Texas, ACC 310F

    Excerpt: ... Master Budget s and Planning Chapter 23 NOTE: Focus on all pages (Purchases Budget) Jackson Furniture Company buys and sells tables; its 2008 sales budget is as follows: Quarter 1 2 3 4 Units 500 700 800 1,000 Example The January 1, 2008 inventory is 80 tables. Management desires an ending inventory each quarter equal to 20% of the next quarters sales. Each table costs $300 which is expected to increase by 20% in Q3. Prepare a quarterly purchases budget (quarters 1-3 only) for the year. Example (Purchases Budget) Jackson Furniture Purchases Budget Quarter 2 700 20% 160 860 140 720 $300 $216,000 1 Budgeted sales (in units) Desired ending inventory percentage Budgeted ending inventory Total units required Beginning inventory Required purchases (in units) Cost per unit Total of purchases 500 20% 140 640 80 560 $300 $168,000 3 800 20% 200 1,000 160 840 $360 $302,400 ...

  • 2 Pages

    ac309chpt14

    Columbia Union, ACCT 309

    Excerpt: ... 1 Chapter 14 The Master Budget Planning is the cornerstone of effective management. 2 Budget Process Budget expresses organizations commitment to planned activities and resource acquisition and use End result of process A type of standard 3 Uses of Budgets Control through calculation of variances Identify potential problems Communicates objectives, constraints, and expectations Participation in process helps to produce spirit of cooperation, motivate employees, instill feeling of teamwork 4 5 The Planning Process Strategic Planning Performed by top-level management Statement of organizational mission, goals, and strategies Long-range Foundation on which short-term planning is based Identify key variables Gather information about key variables 6 Tactical Planning Performed by top and mid-management Provides direction for achievement of strategic plans States strategic plans in terms on which managers can act Furnishes bas ...

  • 30 Pages

    CH04

    Cal Poly, ACTG 212

    Excerpt: ... CHAPTER 4 DEVELOPING A BUSINESS PLAN: BUDGETING 1 Chapter Overview How does a budget contribute toward helping a company achieve its goals? Do the activities of a company have a logical order that drives the organization of a budget? What is the structure of the budgeting process, and how does a company begin that process? 2 Chapter Overview What are the similarities and differences between a retail company's and a service company's master budget ? After a company begins the budgeting process, is there a strategy it can use to complete the budget? How can a manager use a budget to evaluate a company's performance and then use the results of that evaluation to influence the company's plans? 3 Budgeting and Budgets Budgeting is a formal part of the ongoing planning process. A budget is a report that gives a financial description of one part of a company's planned activities for the budget period. As an example, a budget might show how many products a company plans to sell in the next year, the do ...

  • 2 Pages

    250_Notes_8B

    Luther, ACCTG 250

    Excerpt: ... ACCT 250 ACCOUNTING FOR DECISION MAKING NOTES CHAPTER 8B SPRING 2008 SUMMARY Here we introduce the role budgets play and the process of budgeting. NOTES 1) The role of budgets a) What is a budget? A plan for action in a coming period including financial and non-financial info Master budget includes: o Operational budgets o Financial budgets b) Why do it? Provides a plan the exercise of planning is highly correlated to success Provides a yard-stick something to measure actual results against o People know what is expected of them provides motivation Provides an opportunity for mid-level managers to be involved in planning Provides coordination among different operating units of the firm Identifies issues which need to be resolved Budgets often serve as targets for bonus compensation can create problems! 2) Connection to strategy As we discussed in chapters 1 and 2, strategy drives many key decisions An annual review of the firm's strategy and long-range plan sets the table o Generally a ...

  • 9 Pages

    Web Chapter 23 Day 2

    University of Texas, ACC 310F

    Excerpt: ... Master Budget s and Planning Chapter 23 NOTE: Focus on all pages Master Budget Components Operating budgets - Sales budget - Purchases or production budget - Selling, general and administrative budget Capital expenditures budget Financial budgets - Cash budget - Budgeted income statement - Budgeted balance sheet (Purchases Budget) Jackson Furniture Company buys and sells tables; its 2008 sales budget is as follows: Quarter 1 2 3 4 Units 500 700 800 1,000 Example The January 1, 2008 inventory is 80 tables. Management desires an ending inventory each quarter equal to 20% of the next quarters sales. Each table costs $300 which is expected to increase by 20% in Q3. Prepare a quarterly purchases budget (quarters 1-3 only) for the year. Example (Purchases Budget) Jackson Furniture Purchases Budget Quarter 2 700 20% 160 860 140 720 $300 $216,000 1 Budgeted sales (in units) Desired ending inventory percentage Budgeted ending inventory Total units required Beginning inventory Required purchases ...

  • 49 Pages

    ch07ima

    FAU, ACG 2071

    Excerpt: ... Chapter 7 The Master Budget 2002 Prentice Hall Business Publishing, Introduction to Management Accounting 12/e, Horngren/Sundem/Stratton 7-1 Objective 1 Explain the major features and advantages of a master budget . 2002 Prentice Hall Business Publishing, Introduction to Management Accounting 12/e, Horngren/Sundem/Stratton 7-2 Advantages of Budgets Budgets Goals and Objectives 2002 Prentice Hall Business Publishing, Introduction to Management Accounting 12/e, Horngren/Sundem/Stratton 7-3 Advantages of Budgets Compels managers to think ahead Aids managers in coordinating their efforts Provides definite expectations that are the best framework to evaluate performance 2002 Prentice Hall Business Publishing, Introduction to Management Accounting 12/e, Horngren/Sundem/Stratton 7-4 Types of Budgets Strategic Plan Long-Range Plan Capital Budget Master Budget Continuous Budget 2002 Prentice Hall Business Publishing, Introduction to Management Accounting 12/e, Horngren/Sundem/Stratton 7-5 Stra ...

  • 1 Pages

    Ch 10 Quiz Notes

    UT Dallas, AIM 3341

    Excerpt: ... time periods and actual results may be used to update the budget for the next period; many organizations use rolling budgets because they incorporate more current info than either static or flexible budgets Cash budget prepared after the operating budgets; they contain receipts, disbursements and shortterm borrowings or investments Master budget a comprehensive plan for an upcoming financial period, usually a year; reflect an organization's future operating and financing decisions, and are often summarized in a set of budgeted financial statements ...

  • 2 Pages

    Lecture 7 - Budgeting

    Temple, ACCT 2521

    Excerpt: ... Budgeting Chapter 6 Vocabulary Budget = quantitative expression of a firm's strategic plan of action Master budget vs. Flexible Purpose and management intentions - planning &/or control Participative budgeting - a.k.a. self-imposed budgeting Preparing the budget Pick period(s): fiscal quarter vs. rolling Project sales Plan production activity level Sales prediction Current finished goods inventory Desired ending finished goods inventory Plan purchases, employment Estimate fixed costs Cash budget Prepare estimated income statements and balance sheets 1 Behavioral aspects Participative budgeting Better information Better cooperation But also budgetary slack Dysfunctional responses `Stretch' vs. Highly achievable budgets Incremental vs. Zero-Based budgeting Compulsion to spend all discretionary funds Short-run emphasis on budget only Questionable actions designed only to balance the budget Uses of budgets Planning O ...

  • 1 Pages

    ACCY 121 Ch06 Study Guides - Fall 2008

    CSU Sacramento, ACCY 121

    Excerpt: ... ACCY 121 Chapter 6 Study Guide - Master Budget ing Horngren, "Cost Accounting," (13e) Pages Schedule Topic Given relevant budget information, calculate: 188-189 1 budgeted sales revenue and sales units 189, 192-193 2, 6A, 6B budgeted units produced and units in ending FG inventory 189-190 3A, 3B budgeted direct material units used and cost of direct material purchases 190-192 4, 5 budgeted cost direct labor and MOH 189, 192-193 2, 6A, 6B budgeted cost of goods manufactured (CGM) 193 7 budgeted cost of goods sold (CGS) and gross margin 205-207 Exh 6-6 budgeted cash collections 205-207 Exh 6-6 budgeted cash paid to suppliers 205-207 Exh 6-6 budgeted ending cash balance 201-202 Understand the Problem for Self-Study Understand the Decision Points 202-203 ...

  • 4.19 Accounting 211

    Penn State, ACCTG 211

    Excerpt: ... Accounting 211 Monday, April 19th, 1999 Announcements: none Lecture notes: Chapter 20 Homework Questions 9. All levels of personnel take part in the budgeting process in a meaningful, creative way. It is necessary to identify them in order to achieve full communication. 12. A set of period budgets that have been consolidated into forecasted financial statements for the entire company. It supplies the projected costs and revenues for a part of the company. 14. Prepare a period budget, prepare forecasted income statement and balance sheet, prepare cash budget 19. It provides the ending cash balance for the period, which is needed to complete the forecasted balance sheet in the master budget and it highlights periods of excess cash reserves or shortages. Exercises 5. January Desired sales in units Desired ending FG inventory 5,000 2,000 7,000 Less desired beginning FG inventory 2,500 February 4,000 3,000 7,000 2,000 March 6,000 3,500 9,500 3,000 Production needs 4,500 5,000 6,500 7. ...

  • 36 Pages

    CH12

    Cal Poly, ACTG 212

    Excerpt: ... CHAPTER 12 DEVELOPING A BUSINESS PLAN FOR A MANUFACTURING COMPANY: BUDGETING 1 Chapter Overview What are the similarities and differences between a large company's master budget and that of an entrepreneurial company? What are the similarities and differences between a large company's master budget and that of a retail company? How is a manufacturing company's operating cycle difference from that of a retail company? 2 Chapter Overview Is there a strategy a manufacturing company can use to complete its budget? If a company's actual sales are different than its budgeted sales (or actual production is different from budgeted production) for the same time period, how can managers meaningfully evaluate how well the company met its cost goals? How do budgets affect the business decisions that employees make? 3 Manufacturing Company Master Budget A manufacturing company's master budget might include these related components Sales budget Production budget Direct materials budget Direct labor budget Fact ...

  • 132 Pages

    ch-10-budgetary-planning

    Arizona, ACCT 210

    Excerpt: ... The Basic Framework of Budgeting: Production Master Budget Summary of all phases of company plans and goals. The Basic Framework of Budgeting Production Master Budget Summary of all phases of company plans and goals. Detail Budget The Basic Framework of Budgeting Detail Budget Production Master Budget Summary of all phases of company plans and goals. Detail Budget The Basic Framework of Budgeting Detail Detail Detail Budget Detail Budget Budget Budget Direct Labor Overhead Materials Master Budget Summary of all phases of company plans and goals. Detail Budget The Basic Framework of Budgeting Detail Detail Detail Budget Detail Budget Budget Budget Detail Budget Direct Labor Overhead Materials Master Budget Summary of all phases of company plans and goals. Detail Budget The Basic Framework of Budgeting Detail Detail Detail Budget Detail Budget Budget Budget Detail DetailBudget Budget Direct Labor Overhead Materials ...

  • 25 Pages

    im_ch10

    South Central College, ACC 210

    Excerpt: ... of budget reports that compare actual results with planned objectives. The budget reports provide management with feedback on operations. Budgetary control involves: a. Developing budgets. b. Analyzing the differences between actual and budgeted results. c. Taking corrective action. d. Modifying future plans, if necessary. Budgetary control works best when a company has a formalized reporting system. The system should a. Identify the name of the budget report such as the sales budget or the manufacturing overhead budget. b. State the frequency of the report such as weekly, or monthly. c. Specify the purpose of the report. d. Indicate the primary recipient(s) of the report. 2. 3. Static Budget Reports 4. (S.O. 2) A static budget does not modify or adjust data regardless of changes in activity during the year. As a result, actual results are always compared with the budget data at the activity level used in developing the master budget . A static budget is appropriate in evaluating a manager's effective ...

  • 22 Pages

    Chapter 9-Answers

    University of North Texas Health Science Center, ACCT 3361

    Excerpt: ... Chapter 9 Inventory Costing and Capacity Analysis 1) The two most common methods of costing inventories in manufacturing companies are variable costing and fixed costing. 2) Absorption costing "absorbs" only variable manufacturing costs. 3) Variable ...

  • 50 Pages

    ch9 hw solutions

    Rutgers, ACCT 451

    Excerpt: ... Overhead Overhead Rate per MachineCosts Hour (2) (5) $10,400,000 $ 4.3333 10,400,000 6.50 10,400,000 6.9333 10,400,000 10.00 Denominator-Level Capacity (Machine-Hours) (6) = (2) (5) 2,400,000 1,600,000 1,500,000 1,040,000 9-41 9-40 (30 min.) Cost allocation, downward demand spiral. SOLUTION EXHIBIT 9-40 2007 2008 Master Practical Master Budget Capacity Budget (1) (2) (3) $3,832,500 $3,832,500 $3,832,500 2,555,000 3,650,000 2,190,000 Budgeted fixed costs Denominator level Budgeted fixed cost per meal Budgeted fixed costs Denominator level ($3,832,500 2,555,000; $3,832,500 3,650,000; $3,832,500 2,190,000) $ Budgeted variable cost per meal Total budgeted cost per meal $ 1.50 $ 3.80 5.30 $ 1.05 $ 3.80 4.85 $ 1.75 3.80 5.55 1. The 2007 budgeted fixed costs are $3,832,500. MedChef budgets for 2,555,000 meals in 2007, and this is used as the denominator level to calculate the fixed cost per meal. $3,832,500 2,555,000 = $1.50 fixed cost per meal. (see column (1) in Solution Exhibit 9-4 ...

  • 50 Pages

    Chapter 9 Solutions

    USC, ACCT 372

    Excerpt: ... Overhead Overhead Rate per MachineCosts Hour (2) (5) $10,400,000 $ 4.3333 10,400,000 6.50 10,400,000 6.9333 10,400,000 10.00 Denominator-Level Capacity (Machine-Hours) (6) = (2) (5) 2,400,000 1,600,000 1,500,000 1,040,000 9-41 9-40 (30 min.) Cost allocation, downward demand spiral. SOLUTION EXHIBIT 9-40 2007 2008 Master Practical Master Budget Capacity Budget (1) (2) (3) $3,832,500 $3,832,500 $3,832,500 2,555,000 3,650,000 2,190,000 Budgeted fixed costs Denominator level Budgeted fixed cost per meal Budgeted fixed costs Denominator level ($3,832,500 2,555,000; $3,832,500 3,650,000; $3,832,500 2,190,000) $ Budgeted variable cost per meal Total budgeted cost per meal $ 1.50 $ 3.80 5.30 $ 1.05 $ 3.80 4.85 $ 1.75 3.80 5.55 1. The 2007 budgeted fixed costs are $3,832,500. MedChef budgets for 2,555,000 meals in 2007, and this is used as the denominator level to calculate the fixed cost per meal. $3,832,500 2,555,000 = $1.50 fixed cost per meal. (see column (1) in Solution Exhibit 9-4 ...

  • 2 Pages

    Reading Assignments

    JMU, A 620

    Excerpt: ... ting Pages 286-288: Comparison of Income under Absorption vs. Variable Costing Page 295: Variable Costing and Absorption Costing sections Page 298-301: Choosing a Costing Method Pages 322-324: Pages 324-330: Pages 330-335: Pages 350-351: Introduction to Activity Based Costing Designing an ABC system Mechanics of an ABC system Summary MODULE SIX Pages 440-442: Introduction to Standard Costing Pages 442-443: Ideal vs. Practical Standards Pages 447-448: A General Model for Variance Analysis Pages 446-456: A Closer Look at Material and Labor Variances Note: After class, read pages 456-457 on Overhead Variances Pages 459-461: Management by Exception Pages 462-463: Evaluation of Controls Based on Standard Costs Note: Remainder of Chapter 10 might be interesting to scan Pages 386-397: The Master Budget and its Components Pages 404-406: Review Problem Page 407-414: EOQ, Re-order Point, and Production Lot Size Determination (study in depth) Page 504-507: Flexible Budgets (through "How a Flexible Budget Works") Note: ...