The controller of the Stump Company is preparing the budget for 2021 and needs to estimate a cost function for delivery costs. Information regarding delivery costs incurred in the prior 2 months​ are: LOADING... ​(Click the icon to view the​ information.)   Requirements 1. Estimate the cost function for delivery. 2. Can the constant in the cost function be used as an estimate of fixed delivery cost per​ month? Explain.   Requirement 1. Estimate the cost function for delivery.   Delivery costs =   + (   ×   ) Delivery costs =   + (   ×   ) Requirement 2. Can the constant in the cost function be used as an estimate of fixed delivery cost per​ month? Explain.   The cost function in requirement 1 is an estimate of how costs behave ▼   outside of within the relevant​ range, not at cost levels ▼   outside within the relevant range. If there are no months with zero miles driven represented in the delivery cost account in the general​ ledger, data in that account ▼   can cannot be used to estimate the fixed costs at the zero miles driven level. The constant component of the cost function provides the best available starting point for a straight line that approximates how a cost behaves ▼   at any production level within the relevant range

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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.