Phoenix Company reports the following fixed budget. It is based on an expected production and sales volume of 15,000 units. PHOENIX COMPANY Fixed Budget For Year Ended December 31 Sales $ 3,000,000 Costs Direct materials 960,000 Direct labor 240,000 Sales staff commissions 60,000 Depreciation- Machinery 305,000 Supervisory salaries 204,000 Shipping 225,000 Sales staff salaries (fixed annual amount) 248,000 Administrative salaries 415,000 Depreciation Office equipment 193,000 Income $ 150,000 Required: The company's business conditions are improving. One possible result is a sales volume of 18,000 units. Prepare a simple budgeted income statement if 18,000 units are sold.

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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.