Skullduggery, Inc. reports the following information from its sales budget: Budgeted sales (units) July 95,000 August 97,000 September 100,000 October 105,000 November 103,000 December 107,000 The budgeted sales price per unit is $5. All sales are on credit and are expected to be collected 10% in the month of sale, 60% in the month following sale, and the remaining 30% in the second month following sale. The company desires each month’s ending finished goods inventory to equal 20% of the following month’s sales. Budgeted production units for August is: a. 96,400 units b. 97,000 units c. 101,000 units d. 104,600 units e. 97,600 units
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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Skullduggery, Inc. reports the following information from its sales budget:
Budgeted sales (units)
July
95,000
August
97,000
September
100,000
October
105,000
November
103,000
December
107,000
The budgeted sales price per unit is $5. All sales are on credit and are expected to be collected 10% in the month of sale, 60% in the month following sale, and the remaining 30% in the second month following sale. The company desires each month’s ending finished goods inventory to equal 20% of the following month’s sales. Budgeted production units for August is:
a. 96,400 units
b. 97,000 units
c. 101,000 units
d. 104,600 units
e. 97,600 units
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