Max began manufacturing operations for Ocean Bath Oils in 20x2. His biggest customer is a national retail store chain that sells hair and bath products. Max would like an estimate of the company's income from operations for 20x2. Calculate the company's income from operations by completing the following operating budgets (Q1, Q2, Q3, Q4 AND Year Total)and budgeted income statement Sales Budget Units Price Total sales Q1 Sales in units Add ending inv Desired total units Less beginning inv Total to produce 4,000 5 20,000 Q2 400 3,000 Q3 5,000 Production Budget 1) Desired units of ending FG inventory = 10% of next quarter sales 2) Beginning FG inventory is 400, ending for Q4 = 600 Q1 Q2 Q3 Q4 Q4 5,000 600
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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