A company is preparing its May budget and provides the following information: Budgeted sales: Budgeted production: 4,100 units Budgeted selling price per unit: $60/unit Budgeted production cost per unit (includes DM/DL/MOH): $10/unit Budgeted variable selling and administrative cost per unit: $4/unit Fixed selling and administrative costs (excludes depreciation): $15,000 Depreciation on office equipment in administrative offices: $3,000 4,000 units Calculate the Net Income that would appear on the company's Budgeted Income Statement for the month of May:
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.
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