Lily Inc. is preparing its annual budgets for the year ending December 31, 2022. Accounting assistants furnish the data shown below. Product JB 50 Product JB 60 Sales budget: Anticipated volume in units Unit selling price i Production budget: Desired ending finished goods units Beginning finished goods units Direct materials budget: Direct materials per unit (pounds) Desired ending direct materials pounds Beginning direct materials pounds i Cost per pound Direct labor budget: Direct labor time per unit Direct labor rate per hour Budgeted income statement: Total unit cost 336,000 $25 25,200 21,000 2 25,200 33,600 $3 0.4 $12 $13 168,000 $30 12,600 8,400 3 8,400 12,600 $4 0.6 $12 $20 An accounting assistant has prepared the detailed manufacturing overhead budget and the selling and administrative expense budget. The latter shows selling expenses of $470,400 for product JB 50 and $302,400 for product JB 60, and administrative expenses of $453,600 for product JB 50 and $285,600 for product JB 60. Interest expense is $150,000 (not allocated to products). Income taxes are expected to be 20%.
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.
![Prepare the budegeted multiple-step income statement for the year. (Note: income taxes are not allocated to the products).
LILY INC.
Budgeted Income Statement
eTextbook and Media
$
JB 50
$
JB 60
Total](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F6624f8de-2dcc-46b1-8ea2-b740df52ef7a%2F296ace17-34b8-4cf2-9855-98ea376d3f55%2F9prnq3w_processed.jpeg&w=3840&q=75)
![Lily Inc. is preparing its annual budgets for the year ending December 31, 2022. Accounting assistants furnish the data shown below.
Sales budget:
Anticipated volume in units
Unit selling price
Production budget:
Desired ending finished goods units
Beginning finished goods units
Direct materials budget:
Direct materials per unit (pounds)
Desired ending direct materials pounds
Beginning direct materials pounds
Cost per pound
Direct labor budget:
Direct labor time per unit
Direct labor rate per hour
Budgeted income statement:
Total unit cost
Product
JB 50
336,000
$25
25,200
21,000
2
25,200
33,600
$3
0.4
$12
$13
Product
JB 60
168,000
$30
12,600
8,400
3
8,400
12,600
$4
0.6
$12
$20
An accounting assistant has prepared the detailed manufacturing overhead budget and the selling and administrative expense budget.
The latter shows selling expenses of $470,400 for product JB 50 and $302,400 for product JB 60, and administrative expenses of
$453,600 for product JB 50 and $285,600 for product JB 60. Interest expense is $150,000 (not allocated to products). Income taxes
are expected to be 20%.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F6624f8de-2dcc-46b1-8ea2-b740df52ef7a%2F296ace17-34b8-4cf2-9855-98ea376d3f55%2Fns4wwk_processed.jpeg&w=3840&q=75)
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