Rodgers Mfg. Co. prepares a flexible budget. The originalbudget forecasts sales of 100,000 units @ $20 and operatingexpenses of $300,000 fixed, plus $2 per unit. Production wasbudgeted at 100,000 units. Actual sales and production forthe period totaled 110,000 units. When the budget is adjustedto reflect these new activity levels, which of the followingbudgeted amounts will increase, but by less than 10 percent?a. Sales revenue.b. Variable manufacturing costs.
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.
Rodgers Mfg. Co. prepares a flexible budget. The original
budget
expenses of $300,000 fixed, plus $2 per unit. Production was
budgeted at 100,000 units. Actual sales and production for
the period totaled 110,000 units. When the budget is adjusted
to reflect these new activity levels, which of the following
budgeted amounts will increase, but by less than 10 percent?
a. Sales revenue.
b. Variable
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