A budget is a financial plan of future costs and revenues for a particular time period in the future.
Purposes of Budgeting
- To evaluate budgeted costs with actual costs at same level of activity
- To aid in monitoring costs
- To project product levels
- To judge same with same
- Sales Budget = Budgeted Unit Sales X Budgeted Selling Price
- Production Budget = Budgeted Sales + Budgeted Closing Stock – Budgeted Opening Stock
- Material Usage Budget = Production Units X Units of Diff...