The production department of Zan Corporation has submitted the following forecast of units upcoming fiscal year. Units to be produced 1st Quarter 5,300 2nd 4th 3rd Quarter Quarter Quarter 8,300 7,300 6,300
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 production department of Zan Corporation has submitted the following forecast of units to be produced by quarter for the
upcoming fiscal year.
Units to be produced
1st
Quarter
5,300
and
3rd
Quarter Quarter
8,300 7,300
4th
Quarter.
6,300
In addition, 6,300 grams of raw materials inventory is on hand at the start of the 1st quarter and the beginning accounts payable for the
1st quarter is $3,180
Each unit requires 8.30 grams of raw material that costs $1.20 per gram. Management desires to end each quarter with an inventory of
raw materials equal to 40% of the following quarter's production needs. The desired ending inventory for the 4th quarter is 8,300
grams. Management plans to pay for 60% of raw material purchases in the quarter acquired and 40% in the following quarter. Each unit
requires 0.20 direct labour-hours and direct labourers are paid $10.90 per hour.
Required:
1. Prepare the company's direct materials purchases budget and schedule of expected cash disbursements for materials for the
upcoming fis
year.
Zan Corporation
Direct Materials Budget](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F400d82c6-c67e-4402-9e0f-10341c522ec9%2Fec5012e0-8b81-47a1-a4e9-f6dc4deb50b5%2Fhg0ughg_processed.jpeg&w=3840&q=75)
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