Imagine that you run a nationwide chain of pizza stores in multiple states. Now it is the end of 2023, and you start preparing various budgets for 2024. List what information you need to gather and what assumptions you must make in order to prepare various budgets. Is there a specific order of the budgets prepared? Which budgets are most important in your opinion? Explain why.
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.
Imagine that you run a nationwide chain of pizza stores in multiple states. Now it is the end of 2023, and you start preparing various budgets for 2024.
List what information you need to gather and what assumptions you must make in order to prepare various budgets.
Is there a specific order of the budgets prepared?
Which budgets are most important in your opinion? Explain why.
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