Warshaw Company budgets payroll at $3,500 per month plus a percentage of monthly sales. The June operating expenses budget includes total payroll of $12,000 with budgeted sales of $170,000. Sales for July are budgeted at $130,000 while purchases of inventory for July are budgeted at $970,000. Depreciation and insurance for July are estimated at $1,300 and $800, respectively. Office and administrative expenses related to purchasing inventory are budgeted at 55% of purchases for the month. The purchase of $2,200in equipment and $2,000 furniture is expected in July. If the percentage of monthly sales used in budgeting payroll increases 30%, what would the total payroll budgeted for July be?
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.
Warshaw Company budgets payroll at $3,500 per month plus a percentage of monthly sales. The June operating expenses budget includes total payroll of $12,000
with budgeted sales of $170,000. Sales for July are budgeted at $130,000
while purchases of inventory for July are budgeted at $970,000.
and $800, respectively. Office and administrative expenses related to purchasing inventory are budgeted at 55%
of purchases for the month. The purchase of $2,200in equipment and $2,000 furniture is expected in July. If the percentage of monthly sales used in budgeting payroll increases 30%,
what would the total payroll budgeted for July be?
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