Brown Inc.'s production budget for Product X for the year ended December 31 is as follows: Product X Sales 640,000 units Plus desired ending inventory 85,000 Total 725,000 Less estimated beginning inventory, Jan. 1 90,000 Total production 635,000 In Brown's production operations, Materials A, B, and C are required to make Product X. The quantities of direct materials expected to be used for each unit of product are as follows: Product X Material A .50 pound per unit Material B 1.00 pound per unit Material C 1.20 pound per unit The prices of direct materials are as follows: Material A $0.60 per pound Material B $1.70 per pound Material C $1.50 per pound Prepare a direct materials purchases budget for Product X. Enter all answers as positive amounts. Brown Inc.Direct Materials Purchases Budget A B C Total Units required for production of Product X (lbs) fill in the blank 1 fill in the blank 2 fill in the blank 3 Unit price $fill in the blank 4 $fill in the blank 5 $fill in the blank 6 Total direct materials purchases $fill in the blank 7 $fill in the blank 8 $fill in the blank 9 $fill in the blank 10
Master Budget
A master budget can be defined as an estimation of the revenue earned or expenses incurred over a specified period of time in the future and it is generally prepared on a periodic basis which can be either monthly, quarterly, half-yearly, or annually. It helps a business, an organization, or even an individual to manage the money effectively. A budget also helps in monitoring the performance of the people in the organization and helps in better decision-making.
Sales Budget and Selling
A budget is a financial plan designed by an undertaking for a definite period in future which acts as a major contributor towards enhancing the financial success of the business undertaking. The budget generally takes into account both current and future income and expenses.
Brown Inc.'s production budget for Product X for the year ended December 31 is as follows:
| Product X | ||
| Sales | 640,000 | units |
| Plus desired ending inventory | 85,000 | |
| Total | 725,000 | |
| Less estimated beginning inventory, Jan. 1 | 90,000 | |
| Total production | 635,000 |
In Brown's production operations, Materials A, B, and C are required to make Product X. The quantities of direct materials expected to be used for each unit of product are as follows:
Product X
Material A .50 pound per unit
Material B 1.00 pound per unit
Material C 1.20 pound per unit
The prices of direct materials are as follows:
Material A $0.60 per pound
Material B $1.70 per pound
Material C $1.50 per pound
Prepare a direct materials purchases budget for Product X. Enter all answers as positive amounts.
Brown Inc.Direct Materials Purchases Budget
| A | B | C | Total | |
| Units required for production of Product X (lbs) | fill in the blank 1 | fill in the blank 2 | fill in the blank 3 | |
| Unit price | $fill in the blank 4 | $fill in the blank 5 | $fill in the blank 6 | |
| Total direct materials purchases | $fill in the blank 7 | $fill in the blank 8 | $fill in the blank 9 | $fill in the blank 10 |
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