[The following information applies to the questions displayed below.] Morganton Company makes one product and it provided the following information to help prepare the master budget
Q: What is the basic difference between a master budget and a flexible budget? a. Master budget is for…
A: One of the difference is In case of master budget the cost is for one level of activity whereas in…
Q: When preparing the direct labor budget, ________.
A: There are manu type of budgets which are prepared by an organisation. For example: 1. Raw materials…
Q: Describing master budget components Sarah Edwards, division manager for Pillows Plus, is speaking to…
A: Master budget: Master budget is an interrelated budget that collectively summarizes all the planned…
Q: Master budget is compiled of several operating budgets. Of these operating budgets, which budget…
A: the operating budget is such a statement that present the financial plan for each of the…
Q: A static budget is ( check all that apply): a. Prepared for various levels of sales volume b.…
A: A Static Budget is prepared at the beginning of a period for an expected sales volume. Static is…
Q: There are various budgets in the budgeting process. Once of these budgets is the production budget.…
A: The production budget refers to the budget which forecasts the production for the future accounting…
Q: Amounts from all of the following budgets feed into the pro-forma income statement except the: a.…
A: Budget can be defined as a statement to predict the future activities prepared to estimate the…
Q: A company prepares the master budget by taking each division manager's estimate of revenues and…
A: Managers that use this technique run the risk of underestimating expectations and exceeding them. In…
Q: Which of the following is a benefit of using budget-management software? (check all that apply).…
A: Benefit of Budgeted Management Software Budgeted management software helps to the management in…
Q: 2. Which of the following is the cornerstone (or most critical element) of the master budget? The…
A: Hi student Since there are multiple questions, we will answer only first question. If you want…
Q: WellWheats, Inc. produces breakfast cereal and sells each box, or unit, for $7. The company is…
A: Units to be produced =Units to be sold +Desired closing inventory -Opening inventory=1000 +…
Q: Which of the following equations is used to prepare a direct labor budget? Multiple Choice Required…
A: While preparing the direct labor budget we should not consider the estimated sales in finished…
Q: Assume that Samsung’s consumer electronics division is charged with preparing a master budget.…
A: Master budget: Master budget is an interrelated budget that collectively summarizes all the planned…
Q: Prepare a budget report based on flexible budget data to help Joe -хpenses.)
A: In this question, we have to calculate the budget report for the swift company clothing department.…
Q: All the following are considered operating budgets except Cash budget Materials budget Production…
A: Operating budgets are meant for the activities like buying, selling, paying or receiving bills.
Q: For this assignment you are to assume that you are involved in the preparation of your company's…
A: The issue is that the sales team is provided that the expected sales for the year and also there…
Q: Need solution will rate1
A: Answer: B. Accounts Receivable The sales are made to accounts receivable by means of sale of goods…
Q: Which is the correct order of components in a master budget? a) Sales budget, cash budget, budgeted…
A: The budget is prepared by the management to estimate the sales, inventory purchase or produced,…
Q: Explain the reason behind this. Amounts from all of the following budgets feed into the pro-forma…
A: Budget is the estimation of revenue & expenditure amount for a particular period which will be…
Q: WellWheats, Inc. produces breakfast cereal and sells each box, or unit, for $7. The company is…
A: Particulars March Budgeted sales (units) 1000 Add: Desired Ending inventory (1000*10%) 100…
Q: Write a note to explain the concept of Functional Budgets. Mention the flow in which budgeting…
A: solution concept Functional budget There are various functions in carrying out the manufacturing…
Q: Why should each department participate in preparing its own budget?
A: In Accounting, Budget refers to a statement prepared on the basis of future plans and goals for a…
Q: Which of the following is true? a) The direct materials purchases budget is determined from the…
A: The budget is prepared by the management to estimate future revenue and expenditure. It is helpful…
Q: 26. The sales budget is the first budget to be created in a commercial setting. This is followed by…
A: Budgets are very important forecasts or estimates that are made for the future period. Budget means…
Q: The following budgets are all financial budgets except for the O A. combined cash budget. OB.…
A: A budget can be defined as a financial plan or an estimation of revenues, expenditure, sales,…
Q: An internal report that helps management compare actual performance and budgeted performance based…
A: Budget: A budget is an estimation to determine the income that will be earned and expenses that will…
Q: company's CEO has a meeting with the sales manager to discuss plans to close the gap between the…
A: Budget and Forecast: Budget is the firm plans, policies and activity in the form of a mathematical…
Q: Which of the following represents the normal sequence in which the below budgets are prepared? 1.…
A: The budgets are prepared to estimate the costs, expenses and revenue for the future.
Q: What is the basic difference between a master budget and a flexible budget? Master budget is for…
A: A budget is an estimation prepared to determine the income that will be earned and expenditure that…
Q: Briefly explain at least three ways in which a business mayexpect to benefit from preparing a formal…
A:
Q: A firm's operating budgets usually begin with the: a.direct materials purchases budget.…
A: Budget: It is a projection of any expense / income of a particular period of time. The time frame…
Q: As a management accountant who specializes in restating operational budgets, you have been asked to…
A:
Q: Explain what the production budget calculates and how the production budget would affect other…
A: The production budget calculates the number of units of products that must be manufactured…
Q: Which of the following statements correctly describes rela-tionships within the master budget? (More…
A:
Q: In a Master Budget, the Production Budget Units of Goods to be manufactured = a. Beginning…
A: Hi student Since there are multiple questions, we will answer only first question.
Q: Which of the operating budgets is prepared first? Group of answer choices C. cash received budget D.…
A: Master Budget: It is the sum of all lower-level budgets prepared by a company's various functional…
Q: 1. Which of the following is true? a) The direct materials purchase budget is determined from the…
A: As per the honor code, We’ll answer the first question since the exact one wasn’t specified. Please…
Q: Which of the following budgets are prepared before the sales budget? Budgeted Income…
A: Sales budgets are financial plans that forecast a company's overall income for a certain time.…
Q: The master budget will comprise: a. The preparation of projected Incomes statement and Balance…
A: Budget is prepared by the management on the basis of past experience. On the basis of the budget, It…
Q: A master budget consists of a. all the accounting journals and ledgers used by a company. b.…
A: Budget is prepared for a particular period which shows the estimation of revenue and expense. The…
Q: Production budgets are used as a basis for the preparation of which of the following budgets? a.…
A: The production budget, which is established by a combination of a sales forecast and the anticipated…
Q: Amounts from all of the following budgets feed into the pro-forma income statement except the: a.…
A: Introduction: Sales budget: Sales budget means estimation of future sales from the past sales data.…
Q: "In the annual meeting of Brixton company, the Head of the accounting department of the company…
A: Budget: It is an estimation of the cost to be incurred and the revenue to be achieved in the future.…
Q: Smpany business rules. You will create a master budget for Williams Company, including their cash…
A: Standard costing is the costing method, where standard or expected costs are used in calculating…
Trending now
This is a popular solution!
Step by step
Solved in 2 steps with 1 images
- Budgeted income statement and balance sheet As a preliminary to requesting budget estimates of sales, costs, and expenses for the fiscal year beginning January 1, 20Y9, the following tentative trial balance as of December 31, 20Y8, is prepared by the Accounting Department of Mesa Publishing Co.: Factory output and sales for 20Y9 are expected to total 3,800 units of product, which are to be sold at 120 per unit. The quantities and costs of the inventories at December 31, 20Y9, are expected to remain unchanged from the balances at the beginning of the year. Budget estimates of manufacturing costs and operating expenses for the year are summarized as follows: Balances of accounts receivable, prepaid expenses, and accounts payable at the end of the year are not expected to differ significantly from the beginning balances. Federal income tax of 35,000 on 20Y9 taxable income will be paid during 20Y9. Regular quarterly cash dividends of 0.20 per share are expected to be declared and paid in March, June, September, and December on 20,000 shares of common stock outstanding. It is anticipated that fixed assets will be purchased for 22,000 cash in May. Instructions Prepare a budgeted income statement for 20Y9. Prepare a budgeted balance sheet as of December 31, 20Y9, with supporting calculations.Budgeted income statement and supporting budgets The budget director of Jupiter Helmets Inc., with the assistance of the controller, treasurer, production manager, and sales manager, has gathered the following data for use in developing the budgeted income statement for May: Prepare a cost of goods sold budget for May. Work in process at the beginning of May is estimated to be $4200. and work in process at the end of May is desired to be $3800.Before the year began, the following static budget was developed for the estimated sales of 100,000. Sales are sluggish and management needs to revise its budget. Use this information to prepare a flexible budget for 80,000 and 90,000 units of sales.
- Digital Solutions Inc. uses flexible budgets that are based on the following data: Prepare a flexible selling and administrative expenses budget for October for sales volumes of 500,000, 750,000, and 1,000,000.Budgeted income statement and supporting budgets for three months Bellaire Inc. gathered the following data for use in developing the budgets for the first quarter (January, February, March) of its fiscal year: Estimated sales at 125 per unit: Estimated finished goods inventories: Work in process inventories are estimated to be insignificant (zero). Estimated direct materials inventories: Manufacturing costs: Selling expenses: Instructions Prepare the following budgets using one column for each month and a total column for the first quarter, as shown for the sales budget: Prepare a sales budget for March. Prepare a production budget for March. Prepare a direct materials purchases budget for March. Prepare a direct labor cost budget for March. Prepare a factory overhead cost budget for March. Prepare a cost of goods sold budget for March. Prepare a selling and administrative expenses budget for March. Prepare a budgeted income statement with budgeted operating income for March.Before the year began, the following static budget was developed for the estimated sales of 50,000. Sales are higher than expected and management needs to revise its budget. Prepare a flexible budget for 100,000 and 110,000 units of sales.
- Shalimar Company manufactures and sells industrial products. For next year, Shalimar has budgeted the follow sales: In Shalimars experience, 10 percent of sales are paid in cash. Of the sales on account, 65 percent are collected in the quarter of sale, 25 percent are collected in the quarter following the sale, and 7 percent are collected in the second quarter after the sale. The remaining 3 percent are never collected. Total sales for the third quarter of the current year are 4,900,000 and for the fourth quarter of the current year are 6,850,000. Required: 1. Calculate cash sales and credit sales expected in the last two quarters of the current year, and in each quarter of next year. 2. Construct a cash receipts budget for Shalimar Company for each quarter of the next year, showing the cash sales and the cash collections from credit sales. 3. What if the recession led Shalimars top management to assume that in the next year 10 percent of credit sales would never be collected? The expected payment percentages in the quarter of sale and the quarter after sale are assumed to be the same. How would that affect cash received in each quarter? Construct a revised cash budget using the new assumption.Operating Budget, Comprehensive Analysis Allison Manufacturing produces a subassembly used in the production of jet aircraft engines. The assembly is sold to engine manufacturers and aircraft maintenance facilities. Projected sales in units for the coming 5 months follow: The following data pertain to production policies and manufacturing specifications followed by Allison Manufacturing: a. Finished goods inventory on January 1 is 32,000 units, each costing 166.06. The desired ending inventory for each month is 80% of the next months sales. b. The data on materials used are as follows: Inventory policy dictates that sufficient materials be on hand at the end of the month to produce 50% of the next months production needs. This is exactly the amount of material on hand on December 31 of the prior year. c. The direct labor used per unit of output is 3 hours. The average direct labor cost per hour is 14.25. d. Overhead each month is estimated using a flexible budget formula. (Note: Activity is measured in direct labor hours.) e. Monthly selling and administrative expenses are also estimated using a flexible budgeting formula. (Note: Activity is measured in units sold.) f. The unit selling price of the subassembly is 205. g. All sales and purchases are for cash. The cash balance on January 1 equals 400,000. The firm requires a minimum ending balance of 50,000. If the firm develops a cash shortage by the end of the month, sufficient cash is borrowed to cover the shortage. Any cash borrowed is repaid at the end of the quarter, as is the interest due (cash borrowed at the end of the quarter is repaid at the end of the following quarter). The interest rate is 12% per annum. No money is owed at the beginning of January. Required: 1. Prepare a monthly operating budget for the first quarter with the following schedules. (Note: Assume that there is no change in work-in-process inventories.) a. Sales budget b. Production budget c. Direct materials purchases budget d. Direct labor budget e. Overhead budget f. Selling and administrative expenses budget g. Ending finished goods inventory budget h. Cost of goods sold budget i. Budgeted income statement j. Cash budget 2. CONCEPTUAL CONNECTION Form a group with two or three other students. Locate a manufacturing plant in your community that has headquarters elsewhere. Interview the controller for the plant regarding the master budgeting process. Ask when the process starts each year, what schedules and budgets are prepared at the plant level, how the controller forecasts the amounts, and how those schedules and budgets fit in with the overall corporate budget. Is the budgetary process participative? Also, find out how budgets are used for performance analysis. Write a summary of the interview.Preparing a performance report Use the flexible budget prepared in P7-6 for the 29,000-unit level of activity and the actual operating results listed below for the 29,000- unit level. Required: 1. Prepare a performance report. 2. List the major reasons why the actual operating income at 29,000 units differs from the master budget operating income at 30,000 units in Figure 7-12. 3. Given the level at which the company operated, how was its cost control? Item Direct materials: Direct labor:
- Cash budget The controller of Bridgeport Housewares Inc. instructs you to prepare a monthly cash budget for the next three months. You are presented with the following budget information: The company expects to sell about 10% of its merchandise for cash. Of sales on account, 70% are expected to be collected in the month following the sale and the remainder the following month (second month following sale). Depreciation, insurance, and property tax expense represent 50,000 of the estimated monthly manufacturing costs. The annual insurance premium is paid in January, and the annual property taxes are paid in December. Of the remainder of the manufacturing costs, 80% are expected to be paid in the month in which they are incurred and the balance in the following month. Current assets as of September 1 include cash of 40,000, marketable securities of 75,000, and accounts receivable of 300,000 (60,000 from July sales and 240,000 from August sales). Sales on account for July and August were 200,000 and 240,000, respectively. Current liabilities as of September 1 include 40,000 of accounts payable incurred in August for manufacturing costs. All selling and administrative expenses are paid in cash in the period they are incurred. An estimated income tax payment of 55,000 will be made in October. Bridgeports regular quarterly dividend of 25,000 is expected to be declared in October and paid in November. Management desires to maintain a minimum cash balance of 50,000. Instructions Prepare a monthly cash budget and supporting schedules for September, October, and November. On the basis of the cash budget prepared in part (1), what recommendation should be made to the controller?Static budget versus flexible budget The production supervisor of the Machining Department for Hagerstown Company agreed to the following monthly static budget for the upcoming year: The actual amount spent and the actual units produced in the first three months in the Machining Department were as follows: The Machining Department supervisor has been very pleased with this performance because actual expenditures for May-July have been significantly less than the monthly static budget of2,358,000. However, the plant manager believes that the budget should not remain fixed for every month but should flex or adjust to the volume of work that is produced in the Machining Department. Additional budget information for the Machining Department is as follows: a. Prepare a flexible budget for the actual units produced for May, June, and July in the MachiningDepartment. Assume depreciation is a fixed cost. b. Compare the flexible budget with the actual expenditures for the first three months.What does this comparison suggest?The sales department of Macro Manufacturing Co. has forecast sales for its single product to be 20,000 units for June, with three-quarters of the sales expected in the East region and one-fourth in the West region. The budgeted selling price is 25 per unit. The desired ending inventory on June 30 is 2,000 units, and the expected beginning inventory on June 1 is 3,000 units. Prepare the following: a. A sales budget for June. b. A production budget for June.