Canucks plc has prepared the following flexible budget for the coming year. The Budgeted level of activity is 7,500 units. Sales Direct material Direct labour Variable overheads Fixed overheads Profit £ 250,000 75,000 60,000 30,000 45,000 22,500 If the budget is flexed to a level of activity of 10,000 units, what would the total budgeted cost be? a) £265,000 b) £280,000 c) £123,750 d) £168,750
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.
Canucks plc has prepared the following flexible budget for the coming year. The Budgeted level of activity is 7,500 units.
Sales
Direct material Direct labour Variable
£ 250,000 75,000 60,000 30,000 45,000 22,500
If the budget is flexed to a level of activity of 10,000 units, what would the total budgeted cost be?
-
a) £265,000
-
b) £280,000
-
c) £123,750
-
d) £168,750
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