Prepare Bates & Hill’s cash payments budget for the first Quarter. (Enter answers in necessary fields only. Leave other fields blank. Do not enter 0.) Maria Bockman, Bates & Hill Fabricators’ accounts payable manager, has just received the company’s direct materials purchases budget for the first quarter. January February March Quarter Budgeted purchase cost $250,020 $262,440 $291,600 $804,060 The company makes all of its direct materials purchases on account. Maria’s recent review of the company’s payment history revealed that the company pays for 25% of its direct materials purchases in the month of purchase and 75% in the month following purchase. The company expects to have an accounts payable balance of $18,000 on January 1, and this amount represents the remaining payables from December’s direct materials purchases.
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.
Prepare Bates & Hill’s
Maria Bockman, Bates & Hill Fabricators’
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January
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February
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March
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Quarter
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Budgeted purchase cost
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$250,020 | $262,440 | $291,600 | $804,060 |
The company makes all of its direct materials purchases on account. Maria’s recent review of the company’s payment history revealed that the company pays for 25% of its direct materials purchases in the month of purchase and 75% in the month following purchase. The company expects to have an accounts payable balance of $18,000 on January 1, and this amount represents the remaining payables from December’s direct materials purchases.
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