It is generally prepared in terms of physical

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firm. It is generally prepared in terms of physical quantities. Short-Term Budget is prepared generally for a period not exceeding 5 years is called Short-term Budget. It is generally prepared in terms of physical quantities and in monetary units. Current Budget is a budget for a very short period, say, a month or a quarter. It is adjusted to current conditions. Therefore, it is called current budget. Rolling Budget is also known as Progressive Budget. Under this method, a budget for a year in advance is prepared. A new budget is prepared after the end of each month/quarter for a full year ahead. The figures for the month/quarter which has rolled down are dropped and the figures for the next month/quarter are added. This practice continues whenever a month/quarter ends and a new month / quarter begins. 15.5 IN TEXT QUESTIONS 1. What do you mean by cash Budget? 2. What do you mean by flexible Budget? 3. What do You mean by Performance Budget? 4. What do you mean by capital Expenditure Budget? 5. What do you mean Rolling Budget? 15.7 TERMINAL EXERCISE 1. ……………………. prepared to give the budgeted cost of any level of activity is termed as a flexible budget. 2. The budget which estimates total sales in terms of items, quantity, value, periods, areas, etc is c alled …………………………….. 3. The budget that anticipates the quantity of personnel required during a period for production activity is known ……………………………. 4. .………………………………., a budget for a year in advance is prepared. 5. …………………..budget relates to the research work to be done for improvement in quality of the products or research for new products
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208 15.8 SUPPLEMENTARY MATERIAL 1. 2. 3. 4. 5. 15.9 ASSIGNMENTS 1. 1.Explain the points to be taken care while preparing the Flexible Budget. 2. Enumerate the importance of research Budgets 3. Highlight the advantages of cash budgets which is prepared by a seasonal manufacturing company. 4. Throw a light on production Budget 15.10 SUGGESTED READINGS 1. Oswal, Maheshwari, Modi Cost accounting. Cost Accounting ( RBD, Jaipur) 2. Pandey. I. M. Management Accounting (S. Chand & Sons.) 3. Agrawal, Shah, Mendiratta, Agarwal, Sharma, Tailor Cost and Management Accounting ( Malik and Co.) 15.11 LEARNING ACTIVITIES Visit the different types of Manufacturing company and take a note on how they are preparing the different types of budgets. 15.12 KEYWORDS Sales Budget, Production Budget, Cost of Production Budget, Purchase Budget, Personnel Budget, Research Budget, Capital Expenditure Budget, Cash Budget, Master Budget, Fixed Budget, Flexible Budgets, Long term Budget, Short Term Budget, Current Budget, Rolling Budget.
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209 LESSON 16 ZERO BASE BUDGETING & MASTER BUDGET 16.1 INTRODUCTION Zero Base Budgeting is a new management technique aimed at cost reduction and optimum utilization of resources. This technique was introduced by the U.s Department of Agriculture in 1961. Petewr. A. Phyrr designed its basic frame work in 1970 and popularized its wider use in the private sector. In 1979, President
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