Walker Company prepares monthly budgets. Company policy is to end each month with merchandise Inventory equal to 15% of budgeted unit sales for the following month. Budgeted sales and merchandise purchases for the next three months follow. Beginning Inventory on July 1 Is 25,500 units. The company budgets sales of 210,000 units In October. The merchandise cost per unit is $2. July 170,000 192,500 August 320,000 318,500 Budgeted sales units September 310,000 295,000 Units to purchase Prepare the merchandise purchases budgets for the months of July, August, and September.
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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