COST OF GOODS SOLD BUDGET - Direct Materials Cost of goods sold are dependent upon the level of sales. The more products Budg workshop makes, the more wood will be used, the more other direct materials will be consumed and the more direct labour will be needed. The principal objective of the cost of goods sold is to manage the inventory of production costs in relation to the sales of goods. Budg would have to calculate the cost of goods sold by multiplying every direct materials and direct labour by the number of units of sales. Direct materials: Wood Dining Chairs Coffee Tables Kitchen Cabinets Total Direct Materials (Wood) Monthly January February 2,700 1,260 3,240 7,200 March 3,600 6,300 3,150 3,780 3,780 4,320 10,530 14,400 TOTAL 12,600 8,190 11,340 32,130 Dining choirs Coffee tables Kitchen cabinet Selling price Materials wood Materiale ather Direct labeur Contribution January February March TOTAL 150 200 350 700 300 100 300 250 350 650 1050 400 Dining chairs (5) 85.00 (18.00) (2.001 (25.00) 40.00 Coffee tables (5) 50.00 (1240) (5.40) (18.00) 14.00 Kitchen cabinets (1) 80.00 [10.80 (9.201 30.00 30.00
COST OF GOODS SOLD BUDGET - Direct Materials Cost of goods sold are dependent upon the level of sales. The more products Budg workshop makes, the more wood will be used, the more other direct materials will be consumed and the more direct labour will be needed. The principal objective of the cost of goods sold is to manage the inventory of production costs in relation to the sales of goods. Budg would have to calculate the cost of goods sold by multiplying every direct materials and direct labour by the number of units of sales. Direct materials: Wood Dining Chairs Coffee Tables Kitchen Cabinets Total Direct Materials (Wood) Monthly January February 2,700 1,260 3,240 7,200 March 3,600 6,300 3,150 3,780 3,780 4,320 10,530 14,400 TOTAL 12,600 8,190 11,340 32,130 Dining choirs Coffee tables Kitchen cabinet Selling price Materials wood Materiale ather Direct labeur Contribution January February March TOTAL 150 200 350 700 300 100 300 250 350 650 1050 400 Dining chairs (5) 85.00 (18.00) (2.001 (25.00) 40.00 Coffee tables (5) 50.00 (1240) (5.40) (18.00) 14.00 Kitchen cabinets (1) 80.00 [10.80 (9.201 30.00 30.00
Cornerstones of Cost Management (Cornerstones Series)
4th Edition
ISBN:9781305970663
Author:Don R. Hansen, Maryanne M. Mowen
Publisher:Don R. Hansen, Maryanne M. Mowen
Chapter15: Lean Accounting And Productivity Measurement
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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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Transcribed Image Text:BUDGETING
A BUSINESS SCENARIO - STEP 4
COST OF GOODS SOLD BUDGET - Direct Materials
Cost of goods sold are dependent upon the level of sales. The more products Budg workshop makes, the more wood will be
used, the more other direct materials will be consumed and the more direct labour will be needed.
The principal objective of the cost of goods sold is to manage the inventory of production costs in relation to the sales of goods.
Budg would have to calculate the cost of goods sold by multiplying every direct
materials and direct labour by the number of units of sales.
Direct materials: Wood
Dining Chairs
Coffee Tables
Kitchen Cabinets
Total Direct Materials (Wood) Monthly
BUDGETING
A BUSINESS SCENARIO - STEP 4
January February
2,700
1,260
3,240
7,200
Direct materials: XXXX
Dining Chairs
Coffee Tables
Kitchen Cabinets
Total Direct Costs Monthly
Direct materials: XXXX
Dining Chairs
Coffee Tables
Kitchen Cabinets
Total Direct Costs Monthly
March
3,600
6,300
3,150
3,780
3,780 4,320
10,530 14,400
January February March
TOTAL
January February March
12,600
8,190
11,340
32,130
TOTAL
Dining choirs
Coffee tables
Kitchen cabinets
TOTAL
Selling price
Materials wood
Materials: other
Direct labeur
Contribution
January February March TOTAL
150
200 350
700
100
250
350
650
1050
300
COST OF GOODS SOLD BUDGET - Direct Materials
Based on your learning in the Direct materials (wood) example, you are required to complete the table below for Budg's other
direct costs.
Dining
chairs (5)
85.00
(18.00)
(2.00)
(25.00)
40.00
Coffee
tables ($)
50.00
(1260)
(5.40)
(18.00)
14.00
300
400
Kitchen
cabinets (5)
80.00
[10.80
(9.201
130.00
30.00
Budgeting Steps
From these budgeted units of sales,
can you produce the total cost of
goods sold budget?
Budgeting Steps
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