Each package of sneakers requires an average of 3.25 feet of heavy-duty cotton, costing $4.15 per foot. Jack determines that the beginning inventory for cotton will be 10,500 feet in January, and the desired ending inventory will be 10% of the following month's production needs. Prepare a direct material budget for Quarter 1: calculate how much canvas will be needed (in feet) and the total cost. (Round to two decimal places for currency; round to whole unit for cotton)
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.
Production costs:
January: 32,439
February: 48,925
March: 54,725
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