A company is preparing the production budget for the second quarter Projected sales (in units) are as follows: April 6000 units May 6800 units June 7500 units The company policy is to have finished goods stocks of 20% of the next month's projected sales. Assuming that there was no opening stock for April, what should be the production quota for May? a. 6800 units b. 6940 units c. 8300 units d. 6660 units
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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April 6000 units
May 6800 units
June 7500 units
The company policy is to have finished goods stocks of 20% of the next month's projected sales. Assuming that there was no opening stock for April, what should be the production quota for May?
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