coated with corrosive protection. Each production department works two8-hour shifts, 5days per week. The production rates for parts in each production department are shown below Production Rates(cases/shift) Cutting Trimming Coating Product A 3.2 2.0 0 Product B 2.5 4.0 1.0 How many cases of each product should
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.
- A small manufacturer of small metal components is planning its production for next month. The company has two products, Product A and Product B. Profit for Product A is $64per case, and profit for Product B is $87 per case. The three main departments at the manufacturing plant are cutting, trimming, and coating. In the production process, metal bars are first cut to the proper length, then trimmed to the desired angle, then coated with corrosive protection. Each production department works two8-hour shifts, 5days per week. The production rates for parts in each production department are shown below
Production Rates(cases/shift)
|
|
Cutting |
Trimming |
Coating |
|
Product A |
3.2 |
2.0 |
0 |
|
Product B |
2.5 |
4.0 |
1.0 |
How many cases of each product should be produced per week to maximize profits?
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