In a manufacturing company, what are the types of budgets included in the master budget? Describe each type.
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.
In a manufacturing company, what are the types of budgets included in the
Master Budget:
The master budget is a collection of budgets that is used by the company for future planning and controlling. The actual results are compared with the budgeted at the end of each period, if needed the necessary actions will be taken to control it.
Step by step
Solved in 2 steps