If Gardner Corporation plans to sell 520,000 units during next year, the number of units it would have to manufacture during the year would 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.
Gardner Corporation budgets on an annual basis for its fiscal year. The following beginning and ending inventory levels (in units) are planned for next year.
| Beginning Inventory | Ending Inventory | |
|---|---|---|
| Raw material* | 48,000 | 58,000 |
| Finished goods | 88,000 | 58,000 |
* Three pounds of raw material are needed to produce each unit of finished product.
If Gardner Corporation plans to sell 520,000 units during next year, the number of units it would have to manufacture during the year would be:
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