Office Plus sells its main product, ergonomic mouse pads, for $12 each. Its variable cost is $5.70 per pad. Fixed costs are $205,000 per month for volumes up to 65.000 pads. Above 65,000 pads, monthly fixed costs are $260,000. Prepare a monthly flexible budget for the product, showing sales revenue, variable costs, fixed costs, and operating income for volume levels of 35,000, 50,000, and 75,000 pads. + Units Office Plus Flexible Budget Budget Amounts Per Unit 35,000 50,000 75,000
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.
Step by step
Solved in 3 steps
