The ManU Hotel is located close to Manchester United's football stadium. It has a souvenir shop that sells two main product lines: hats and scarves in the Manchester United colours. The quarterly sales budget for the forthcoming year is as follows QUARTER HATS SCARVES 1,200 600 800 400 3 4 600 300 1,400 700 It is expected that the shop will be holding 240 hats and 180 scarves in stock at the beginning of the year. The shop manger always likes to keep 20 per cent of the next quarter's hat sales in stock and 30 per cent of the next quarter's scarf sales. Sales of hats and scarves in the first quarter of the following year are expected to be 25 per cent higher than the first quarter of the forthcoming year. Required: Prepare the quarterly purchases budget for hats and scarves for the forthcoming year.
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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