Gloucester Fishing Co. planned a master budget that included $82,000 in fixed overhead for their boat in addition to $13,500 for direct labor, $2,000 for direct materials and $22,750 for variable overhead. The master budget was based on sales of 100,000 lbs. of fish. The actual sales for the season were 110,000 lbs. of fish. What would total overhead costs be on the flexible budget? a. $104,750 b. $107,025 c. $72,000 d. $82,000
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.
Gloucester Fishing Co. planned a
| a. |
$104,750 |
|
| b. |
$107,025 |
|
| c. |
$72,000 |
|
| d. |
$82,000 |
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