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BUDGETING - Coggle Diagram
BUDGETING
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Financial Budgets
Cash Budget
The cash budget estimates the expected receipts (inflows) and payments (outflows) of cash for a period of time.
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Estimated Cash Payments
Estimated cash payments must be budgeted for operating costs and expenses such as manufacturing costs, selling expenses, and administrative expenses.
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Budgeted Balance Sheet
he budgeted balance sheet, sometimes called a pro forma balance sheet, is prepared based on the op-erating and financial budgets of the master budget
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Operating Budgets
Operating Budgets
The sales budget begins by estimating the quantity of sales. The prior year’s sales are often used as a starting point.
Production Budget
The production budget estimates the number of units to be man-ufactured to meet budgeted sales and desired inventory levels.
Flexible Budget
The master budget is an integrated set of operating and financial budgets for a period of time. Most companies prepare a master budget on a yearly basis.
Direct Labor Cost Budget
The direct labor cost budget estimates the direct labor hours and related cost needed to support budgeted production.
Step 1 Determine the budgeted direct labor hours required for production, which is computed as follows
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