QS 20-28A (Algo) Merchandising: Computing purchases LO P4 Raider-X Company budgets sales of 16,000 units for April and 18,000 units for May. Beginning inventory on April 1 is 3,200 units, and the company wants to have 20% of next month's unit sales in inventory at the end of each month. The merchandise cost per unit is $3. Prepare a merchandise purchases budget for the month of April. RAIDER-X COMPANY Merchandise Purchases Budget Budgeted sales units Next period budgeted sales units Ratio of inventory to future sales Total required units Units to be purchased Cost per unit Cost of merchandise purchases $ April 0 0
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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