Sheridan Entertainment Corporation prepared a master budget for the month of November that was based on sales of 187,400 board games. The budgeted income statement for the period is as follows. Sales Revenue $2,811,000 Variable expenses Direct materials $824,560 Direct labor 412,280 Variable overhead 599,680 Total variable expenses 1,836,520 Contribution margin 974,480 Fixed overhead 214,000 Fixed selling and administrative expenses 424,000 Total fixed expenses 638,000 Operating income $336,480 During November, Sheridan produced and sold 159,600 board games. Actual results for the month are as follows. Sales Revenue $2,310,000 Variable expenses Direct materials $692,140 Direct labor 337,020 Variable overhead 499,620 Total variable expenses 1,528,780 Contribution margin 781,220 Fixed overhead 201,000 Fixed selling and administrative expenses 439,000 Total fixed expenses 640,000 Operating income $141,220
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.
Chapter 6 Question 9
Please help me fill in the blanks
Sheridan Entertainment Corporation prepared a
| Sales Revenue | $2,811,000 | ||||
| Variable expenses | |||||
| Direct materials | $824,560 | ||||
| Direct labor | 412,280 | ||||
| Variable |
599,680 | ||||
| Total variable expenses | 1,836,520 | ||||
| Contribution margin | 974,480 | ||||
| Fixed overhead | 214,000 | ||||
| Fixed selling and administrative expenses | 424,000 | ||||
| Total fixed expenses | 638,000 | ||||
| Operating income | $336,480 |
During November, Sheridan produced and sold 159,600 board games. Actual results for the month are as follows.
| Sales Revenue | $2,310,000 | ||||
| Variable expenses | |||||
| Direct materials | $692,140 | ||||
| Direct labor | 337,020 | ||||
| Variable overhead | 499,620 | ||||
| Total variable expenses | 1,528,780 | ||||
| Contribution margin | 781,220 | ||||
| Fixed overhead | 201,000 | ||||
| Fixed selling and administrative expenses | 439,000 | ||||
| Total fixed expenses | 640,000 | ||||
| Operating income | $141,220 |
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