Saratoga Company budgeted the following information for 2022 : May June July Budgeted purchases of merchandise $105,500 $110,500 $101,500 Cost of goods sold is 40% of sales. Accounts payable is used only for merchandise inventory acquisitions. Sarasota purchases and pays for merchandise 60% in the month of acquisition and 40% in the following month. Selling and administrative expenses are budgeted at $32,000 for May and are expected to increase 5% per month. These expenses are paid during the month when incurred. In addition, depreciation is budgeted at $10,000 per month. Income taxes are $39,100 for July and are paid in the month incurred. Compute the amount of budgeted cash disbursements for July.
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.
Saratoga Company budgeted the following information for 2022 : May June July Budgeted purchases of merchandise $105,500 $110,500 $101,500 Cost of goods sold is 40% of sales. Accounts payable is used only for merchandise inventory acquisitions. Sarasota purchases and pays for merchandise 60% in the month of acquisition and 40% in the following month. Selling and administrative expenses are budgeted at $32,000 for May and are expected to increase 5% per month. These expenses are paid during the month when incurred. In addition,
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