1.
Introduction: A sales budget includes a sales projection for the specified budgetary period. It also includes the inventory's target selling price, which is used to determine an entity's anticipated sales for the budgetary period. The sales budget could be regarded as the most vital and significant budget overall. This is because the sales budget serves as the foundation for all other budgets. The production budgets would have a cascading effect on all the operations budgets because they are dependent on the anticipated sales for the time period. A mistake in estimating the period's anticipated sales could have grave repercussions, including the possibility of stock-outs and the opportunity cost of missed revenues as a result of being unable to completely satisfy consumer needs.
To explain: The sales
2.
Introduction: A sales budget includes a sales projection for the specified budgetary period. It also includes the inventory's target selling price, which is used to determine an entity's anticipated sales for the budgetary period. The sales budget could be regarded as the most vital and significant budget overall. This is because the sales budget serves as the foundation for all other budgets. The production budgets would have a cascading effect on all the operations budgets because they are dependent on the anticipated sales for the time period. A mistake in estimating the period's anticipated sales could have grave repercussions, including the possibility of stock-outs and the opportunity cost of missed revenues as a result of being unable to completely satisfy consumer needs.
To explain: The sales forecast required in the given situation.
3.
Introduction: A sales budget includes a sales projection for the specified budgetary period. It also includes the inventory's target selling price, which is used to determine an entity's anticipated sales for the budgetary period. The sales budget could be regarded as the most vital and significant budget overall. This is because the sales budget serves as the foundation for all other budgets. The production budgets would have a cascading effect on all the operations budgets because they are dependent on the anticipated sales for the time period. A mistake in estimating the period's anticipated sales could have grave repercussions, including the possibility of stock-outs and the opportunity cost of missed revenues as a result of being unable to completely satisfy consumer needs.
The sales forecast required in a given situation.
4.
Introduction: A sales budget includes a sales projection for the specified budgetary period. It also includes the inventory's target selling price, which is used to determine an entity's anticipated sales for the budgetary period. The sales budget could be regarded as the most vital and significant budget overall. This is because the sales budget serves as the foundation for all other budgets. The production budgets would have a cascading effect on all the operations budgets because they are dependent on the anticipated sales for the time period. A mistake in estimating the period's anticipated sales could have grave repercussions, including the possibility of stock-outs and the opportunity cost of missed revenues as a result of being unable to completely satisfy consumer needs.
To prepare:
5.
Introduction: A sales budget includes a sales projection for the specified budgetary period. It also includes the inventory's target selling price, which is used to determine an entity's anticipated sales for the budgetary period. The sales budget could be regarded as the most vital and significant budget overall. This is because the sales budget serves as the foundation for all other budgets. The production budgets would have a cascading effect on all the operations budgets because they are dependent on the anticipated sales for the time period. A mistake in estimating the period's anticipated sales could have grave repercussions, including the possibility of stock-outs and the opportunity cost of missed revenues as a result of being unable to completely satisfy consumer needs.
To explain: The appropriateness to involve the sales manager while preparing the sales budget.
6.
Introduction: A sales budget includes a sales projection for the specified budgetary period. It also includes the inventory's target selling price, which is used to determine an entity's anticipated sales for the budgetary period. The sales budget could be regarded as the most vital and significant budget overall. This is because the sales budget serves as the foundation for all other budgets. The production budgets would have a cascading effect on all the operations budgets because they are dependent on the anticipated sales for the time period. A mistake in estimating the period's anticipated sales could have grave repercussions, including the possibility of stock-outs and the opportunity cost of missed revenues as a result of being unable to completely satisfy consumer needs.
The reason the company will allow the sales manager to prepare the sales budget involving the seniors.
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Chapter P Solutions
PACE MANAGERIAL ACC CUST LL W\ACC CARD
- CASH BUDGETING Rework Problem 15-10 using a spreadsheet model. After completing Parts a through d, respond to the following: If Bowers customers began to pay late, collections would slow down, thus increasing the required loan amount. If sales declined, this also would have an effect on the required loan. Do a sensitivity analysis that shows the effects of these two factors on the maximum loan requirement.arrow_forwardBudgeted income statement and supporting budgets The budget director of Feathered Friends Inc., with the assistance of thee controller, treasurer, production manager, and sales manager, has gathered the following data for use in developing the budgeted income statement for December: A. Estimated sales for December Bird house....................... 3,200 units at 50 per unit Bird feeder....................... 3,000 units at 70 per unit B. Estimated inventories at December 1: Direct materials Finished products: Wood............ 220 ft Bird house........ 320 units at 27 per unit Plastic............ 240 ft Bird house........ 270 units at 40 per unit C. Desired inventories at December 31: Direct materials Finished products: Wood............ 220 ft Bird house........ 290 units at 27 per unit Plastic............ 200 ft Bird house........ 205 units at 41 per unit D. Direct materials used in production: In manufacture of Bird House: In manufacture of Bird Feeder: Wood............ 0.80 ft. per unit of product Wood........ 1.20 ft. per unit of product Plastic............ 0.50 lb. per unit of product Plastic......... 0.75 lb. per unit of product E. Anticipated cost of purchases and beginning and ending inventory of direct materials: Wood 7.00 per ft Plastic 1.00 per lb. F. Direct labor requirements: Bird House: Fabrication Department...................... 0.20 hr. at 16 per hr. Assembly Department........................ 0.30 hr. at 12 per hr. Bird Feeder: Fabrication Department...................... 0.40 hr. at 16 per hr. Assembly Department........................ 0.35 hr. at 12 pr hr. G. Estimated factory overhead costs for December: Indirect factory wages 75,000 Depreciation of plant and equipment 23,000 Power and light 6,000 Insurance and property tax 5,000 H. Estimated operating expenses for December: Sales salaries expense 70,000 Advertising expense 18,000 Office salaries expense 21,000 Depreciation expenseoffice equipment 600 Telephone expenseselling 550 Telephone expenseadministrative 250 Travel expenseselling 4,000 Office supplies expense 200 Miscellaneous administrative expense 400 I. Estimated other income and expense for December: Interest revenue200 Interest expense122 J. Estimated tax rate: 30% Instructions 1. Prepare a sales budget for December. 2. Prepare a production budget for December. 3. Prepare a direct materials purchases budget for December. 4. Prepare a direct labor cost budget for December. 5. Prepare a factory overhead cost budget for December. 6. Prepare a cost of goods sold budget for December. Work in process at the beginning of December is estimated to be 29,000, and work in process at the end of December is estimated to be 35,400. 7. Prepare a selling and administrative expenses budget for December. 8. Prepare a budgeted income statement for December.arrow_forwardStatic budget for a service company A bank manager of City Savings bank Inc. uses the managerial accounting system to track the costs of operating the various departments within the bank. The departments include Cash Management, Trust, Commercial Loans, Mortgage Loans, Operations, Credit Card, and Branch Services. The static budget and actual results for the Operations Department are as follows: Resources Budget Actual Salaries 200,000 200,000 Benefits 30,000 30,000 Supplies 45,000 42,000 Travel 20,000 30,000 Training 25,000 35,000 Overtime 25,000 20,000 Total 345.000 357,000 Excess of actual over budget 12,000 a. What information is provided by the budget? Specifically, what questions can the bank manager ask of the Operations Department manager? b. What information does the static budget fail to provide? Specifically, could the budget information be presented differently to provide even more insight for the bank manager?arrow_forward
- Static budget for a service company A bank manager of City Savings Bank Inc. uses the managerial accounting system to track the costs of operating the various departments within the bank. The departments include Cash Management, Trust, Commercial Loans, Mortgage Loans, Operations, Credit Card, and Branch Services. The static budget and actual results for the Operations Department are as follows: Resources Budget Actual Salaries 200,000 200,000 Benefits 30.000 30,000 Supplies 45,000 42,000 Travel 20,000 30,000 Training 25,000 35,000 Overtime 25,000 20,000 Total 345,000 357,000 Excess of actual over budget 12,000 a. What information is provided by the budget? Specifically, what questions can the bank manager ask of the Operations Department manager? b. What information does the static budget fail to provide? Specifically, could the budget information be presented differently to provide even more insight for the bank manager?arrow_forwardarrow_forward Question .(iii) To help achieve the budgeted sales for the year, Sampson is about to introduce bonuses for itssales staff. The bonuses will be an increasing percentage of the gross sales made, by eachsalesperson, above certain monthly targets.(iv) The company is using a new general ledger software package. The financial controller is impressedwith the new system, because management accounts are easily produced and allow detailedcomparisons with budgets and prior-period figures across product lines and geographical areas.The conversion to the new system occurred with a minimum of fuss. As it is a popular computerpackage, it required only minor modifications.(v) As part of the conversion, the position of systems administrator was created. This position isresponsible for all systems maintenance, including data backups and modifications. These taskswere the responsibility of the accountant.Required:For each of the scenarios above, explain how the components of…arrow_forward____ 46. The budget process involves doing all the following except: a. establishing specific goals b. executing plans to achieve the goals c. periodically comparing actual results with the goals d. dismissing all managers who fail to achieve operational goals specified in the budget ____ 47. Division W of MJW Company has sales of $140,000, cost of goods sold of $83,000, operating expenses of $43,000, and invested assets of $100,000. What is the profit margin for Division W? a. 14% b. 2.8% c. 10% d. 5.47% ____ 48. Bulls Company is considering the acquisition of a machine that costs $375,000. The machine is expected to have a useful life of 6 years, a negligible residual value, an annual cash flow of $150,000, and annual operating income of $87,500. What is the estimated cash payback period for the machine? a. 3 years b. 4.3 years c. 2.5 years d. 5 years ____ 49. The…arrow_forward
- UESTION 33 Consider the following five situations: (I) Relative performance evaluation is used for evaluating store managers. (II) Insurabce policy holders pay deductibles before being covered by the insurance (III) The warehouse manager is not held responsible for damages and stolen goods during a riot. (IV) Individual stores are allocated (charged) for the cost of advertising done by the headquarters. (V) In performance evaluation, the actual outcome is compared witht the flexible budget, not the original budget. Which of the above would be examples that go againt the controllability principle (concept)? A. I, II, and III B. I, II, and IV C. I and III D. II and IV E. III and Varrow_forwardPlease give me step by step directions. Ch 26 pro 7 Product Costs using Activity Rates Nozama.com Inc. sells consumer electronics over the Internet. For the next period, the budgeted cost of the sales order processing activity is $540,000 and 60,000 sales orders are estimated to be processed. a. Determine the activity rate of the sales order processing activity.$ ________________________per sales order b. Determine the amount of sales order processing cost that Nozama.com would receive if it had 45,000 sales orders_________________________________.arrow_forward23 I. In a manufacturing business, the production budget is prepared immediately after the sales budget. II. In a manufacturing business, the cash budget is prepared immediately after the sales budget. Only I is true. Both I and II are true. Both I and II are false. Only II is true.arrow_forward
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