Kahn & Loshonkohl static budget for 10,000 units of production includes $60,000 for direct materials, $50,000 for direct labor, variable utilities of $5,000, and supervisor salaries of $30,000. A flexible budget for 12,000 units of production would show: Direct materials of $72,000, direct labor of $60,000, utilities of $6,000, and supervisor salaries of $36,000. Direct materials of $72,000, direct labor of $60,000, utilities of $6,000, and supervisor salaries of $30,000. Total variable costs of $151,000 The same cost structure in total.
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.
Kahn & Loshonkohl static budget for 10,000 units of production includes $60,000 for direct materials, $50,000 for direct labor, variable utilities of $5,000, and supervisor salaries of $30,000.
A flexible budget for 12,000 units of production would show:
- Direct materials of $72,000, direct labor of $60,000, utilities of $6,000, and supervisor salaries of $36,000.
- Direct materials of $72,000, direct labor of $60,000, utilities of $6,000, and supervisor salaries of $30,000.
- Total variable costs of $151,000
- The same cost structure in total.
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