The budgeted prices for materials and direct labor per unit of finished product are $8 and $7, respectively. The production manager is delighted about the following data: Static Budget Direct materials $59,200 Direct labor 51,800 Actual Costs $49,900 39,200 Variance $9,300 F 12,600 F ? ? 33,000 Is the manager’s happiness justified? Prepare a report that might provide a more detailed explanation of why the static budget was not achieved. Good output was 5,300 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.
The budgeted prices for materials and direct labor per unit of finished product are $8 and $7, respectively. The production manager is delighted about the following data: Static Budget Direct materials $59,200 Direct labor 51,800 Actual Costs $49,900 39,200 Variance $9,300 F 12,600 F ? ? 33,000 Is the manager’s happiness justified? Prepare a report that might provide a more detailed explanation of why the static budget was not achieved. Good output was 5,300 units.
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