amari, Inc is considering dropp 's budget for the upcoming year appear bela
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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![Ch. 13-The management of Tamari, Inc is considering dropping product S01S4UC3. Data
from the company's budget for the upcoming year appear below:
Sales
Variable expenses
Fixed manufacturing expenses
Fixed selling and administrative expenses
$ 930,000
$ 378,000
$360,000
$ 240,000
In the company's accounting system all fixed expenses of the company are fully allocated to
products. Further investigation has revealed that $115,000 of the fixed manufacturing
expenses and $102,000 of the fixed selling and administrative expenses are avoidable and can
be eliminated if product C04433 is discontinued. The financial advantage (disadvantage) for
the company of eliminating this product for the upcoming year would be:
($335,000)
$335,000
($552,000)
($165,000)](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F6ff57eeb-02cd-4ad2-bfa7-7cf3c326946a%2F4901c9fc-074a-42df-bf33-108db68eb36e%2F5ed13ih_processed.jpeg&w=3840&q=75)
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