JEROME POGI has the following budget estimates for its 4th year of operations: Inventories are estimated as follows: Raw materials P220,000 270,000 Goods in process P250,000 300,000 Finished goods P350,000 420,000 Beginning Ending Projected sales – P3,500,000 Projected net income before tax – 12% of sales Estimated selling and administrative expenses - 25% of sales Direct labor and factory overhead are budgeted at 70% of the total manufacturing cost. The estimated purchases of raw materials would be
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.
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