ABC company prepared a master budget based on 100 budgeted sales units with a $100 sales price per unit, a variable cost per unit of $50, and $2,000 in total fixed cost. The actual sales quantity was 120 units, the actual sales price per unit was $90, and the actual total fixed cost was $2,500. When preparing a flexible budget, the operating income is: $3,500 $4,000 $2,800 $3,000
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.
ABC company prepared a
$3,500
$4,000
$2,800
$3,000
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