A company has budgeted direct materials purchases of $360000 in July and $520000 in August. Past experience indicates that the company pays for 70% of its purchases in the month of purchase and the remaining 30% in the next month. During August, the following items were budgeted: Wages Expense $150000 Purchase of office equipment 72000 Selling and Administrative Expenses 49000 Depreciation Expense 36000 The budgeted cash disbursements for August are $779000. $743000. $694000. $472000.
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.
A company has budgeted direct materials purchases of $360000 in July and $520000 in August. Past experience indicates that the company pays for 70% of its purchases in the month of purchase and the remaining 30% in the next month. During August, the following items were budgeted:
| Wages Expense | $150000 |
| Purchase of office equipment | 72000 |
| Selling and Administrative Expenses | 49000 |
| Depreciation Expense | 36000 |
The budgeted cash disbursements for August are
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