Beruflich Dokumente
Kultur Dokumente
Planning and
Activity-Based Budgeting
(Short-term Budgeting)
1. Planning
a detailed plan, expressed
in quantitative terms, that 2. Facilitating
Communication and
specifies how resources will
be acquired and used
Coordination
during a specified period of 3. Allocating Resources
time.
4. Controlling Profit and
Operations
5. Evaluating
Performance and
Providing Incentives
Types of Budgets
Pro
duc
tion
Master
Budget
Detail
Budget
Detail
Budget
Detail
Budget
Covering all
phases of
a companys
operations.
9-4
Types of Budgets
Income
Statement
Budgeted
Financial
Statements
Balance
Sheet
Statement of
Cash Flows
9-5
Types of Budgets
1999Rolling Budget2000
2001
2002
9-6
Production
Budge
t
Budget
Work in Process
and Finished
Goods
Ending
Inventory
Budget
Direct
Materials
Budget
Direct
Labor
Budget
Overhead
Budget
Selling and
Administrative
Budget
Direct Materials
Cash Budget
Budgeted Balance
Sheet
Budgeted Statement
of Cash Flows
Budgeted Income
Statement
9-8
Resources
Activity-Based
Costing (ABC)
Activities
Cost objects:
products and services
produced, and
customers served.
Activities
Activity-Based
Budgeting (ABB)
Forecast of products
and services to be
produced and
customers served.
9-10
Sales Budget
20,000 units
50,000 units
30,000 units
25,000 units
15,000 units.
Sales Budget
April
Budgeted
sales (units)
Selling price
per unit
Total
Revenue
May
20,000
June
50,000
Quarter
30,000
100,000
10
10
10
10
200,000
500,000
300,000
1,000,000
9-13
Production Budget
The management of Breakers, Inc. wants
ending inventory to be equal to 20% of the
following months budgeted sales in units.
On March 31, 4,000 units were on hand.
Lets prepare the production budget.
9-14
Production Budget
From
sales
budget
Sales in units
Add: desired
end. inventory
Total needed
Less: beg.
inventory
Units to be
produced
May sales
Desired percent
50,000
20%
Desired inventory
10,000 units
April
20,000
May
50,000
June
30,000
Quarter
100,000
10,000
30,000
4,000
10,000
6,000
4,000
26,000
46,000
29,000
101,000
March 31
ending inventory
9-15
Direct-Material Budget
From our
Production in units
Materials per unit
Production needs
Add: desired
ending inventory
Total needed
Less: beginning
inventory
Materials to be
purchased
April
26,000
5
130,000
May
46,000
5
230,000
June
29,000
5
145,000
Quarter
101,000
5
505,000
23,000
153,000
14,500
244,500
11,500
156,500
11,500
516,500
13,000
23,000
14,500
13,000
140,000
221,500
142,000
503,500
March 31
inventory
9-17
Direct-Material Budget
July Production
April 25,000
May
Sales in units
Add: desired
i ventory
3,000 46,000
Productionendingu its
26,000
Total units needed
28,000
5
Materials per unit
5
Less: beginning inventory 130,000 5,000 230,000
Production needs
Production in units
23,000
n
June
29,000
5
145,000
Add: desired
ending inventory
23,000
14,500
11,500
Total needed
156,500
153,000
244,500
Less: beginning
June Ending Inventory
inventory
14,500
13,000
23,000
23,000
MaterialsJulytoproductionbe in units
purchasedMaterials per unit
5
221,500
Total units needed
115,000
Inventory percentage
10%
June desired ending inventory
11,500
140,000
142,000
Quarter
101,000
5
505,000
11,500
516,500
13,000
503,500
9-18
Direct-Labor Budget
Direct-Labor Budget
Production in units
Direct labor hours
Labor hours required
Guaranteed labor
hours
Labor hours paid
Wage rate
Total direct labot cost
From our
production
budget
$
$
April
26,000
0.10
2,600
May
46,000
0.10
4,600
June
29,000
0.10
2,900
Quarter
101,000
0.10
10,100
3,000
3,000
8
24,000
3,000
4,600
8
36,800
3,000
3,000
8
24,000
10,600
8
84,800
$
$
$
$
$
$
Overhead Budget
Here is Breakers Overhead Budget for the quarter.
April
Indirect labor
17,500
7,000
4,200
13,300
5,800
8,200
56,000
Indirect material
Utilities
Rent
Insurance
Maintenance
May
$
26,500
12,600
8,400
13,300
5,800
9,400
76,000
June
$
17,900
8,600
5,200
13,300
5,800
8,200
59,000
Quarter
$
61,900
28,200
17,800
39,900
17,400
25,800
191,000
9-21
9-22
April
20,000
$
0.50
$ 10,000
May
50,000
$
0.50
$ 25,000
June
30,000
$
0.50
$ 15,000
Quarter
100,000
$
0.50
$ 50,000
70,000
80,000
70,000
95,000
70,000
85,000
210,000
260,000
10,000
10,000
10,000
30,000
$ 70,000
$ 85,000
$ 75,000
$ 230,000
From our
Sales budget
9-23
9-24
April
30,000
May
June
140,000
$
140,000
50,000
50,000
350,000
$ 170,000
$ 400,000
Quarter
$ 30,000
$ 125,000
350,000
125,000
210,000
$ 335,000
210,000
$ 905,000
9-25
9-26
April
$ 12,000
May
June
28,000
28,000
28,000
$ 28,000
44,300
$ 40,000
$ 72,300
Quarter
$ 12,000
$ 44,300
44,300
44,300
28,400
28,400
$ 72,700
$ 185,000
9-28
CashBudgetBudget
May
June
Quarter
Cash Budget
(Collections and Disbursements)
April
Beginning cash balance $ 40,000
Add: cash collections
170,000
Total cash available
210,000
Less: disbursements
Materials
40,000
Direct labor
24,000
Mfg. overhead
56,000
Selling and admin.
70,000
Equipment purchase
Dividends
25,000
Total disbursements
215,000
Excess (deficiency) of
Cash available over
disbursements
$ (5,000)
May
$ 30,000
400,000
430,000
72,300
36,800
76,000
85,000
143,700
413,800
June
Quarter
Breakers must
borrow an
addition $13,800
to maintain a
cash balance of
$30,000.
$ 16,200
9-30
Cash Budget
(Collections and Disbursements)
May
$ 30,000
400,000
430,000
June
$ 30,000
335,000
365,000
24,000
56,000
70,000
25,000
215,000
72,300
36,800
76,000
85,000
143,700
413,800
72,700
24,000
59,000
75,000
48,300
279,000
$ (5,000)
$ 16,200
$ 86,000
April
Beginning cash balance $ 40,000
At the end of June, Breakers
Add: ca h collections
170,000
has enough cash to repay
210,000
Less: disbursements
at 12%.
Materials
Direct labor
Mfg. overhead
Selling and admin.
Equipment purchase
Dividends
Total disbursements
Excess (deficiency) of
Cash available over
disbursements
40,000
Quarter
9-31
Cash Budget
(Collections and Disbursements)
April
Beginning cash balance $ 40,000
Add: cash collections
170,000
Total cash available
210,000
Less: disbursements
Materials
40,000
Direct labor
24,000
Mfg. overhead
56,000
Selling and admin.
70,000
Equipment purchase
Dividends
25,000
Total disbursements
215,000
Excess (deficiency) of
Cash available over
disbursements
$ (5,000)
May
$ 30,000
400,000
430,000
June
$ 30,000
335,000
365,000
Quarter
$ 40,000
905,000
945,000
72,300
36,800
76,000
85,000
143,700
413,800
72,700
24,000
59,000
75,000
48,300
279,000
185,000
84,800
191,000
230,000
192,000
25,000
907,800
$ 16,200
$ 86,000
$ 37,200
9-32
Ending cash
balanceCashforAprilBudget is
the beginning
May
June
Quarter
$ (5,000)
$ 16,200
$ 86,000
$ 37,200
35,000
35,000
$ 30,000
13,800
13,800
$ 30,000
(48,800)
(838)
(49,638)
$ 36,362
48,800
(48,800)
(838)
(838)
$ 36,362
Borrowing
$ 35,000
13,800
Rate
12%
12%
=
=
Annual
Months
Interest
Interest
Outstanding
Expense
$ 4,200
2 mths
= $
700
1,656
1 mth.
=
138
$
838
9-33
May
June
Quarter
Direct material:
Beg.material inventory
$
5,200 $
9,200 $
5,800 $ 5,200
Add: Materials purchases
56,000
88,600
56,800 201,400
Material available for use
61,200
97,800
62,600 206,600
Deduct: End. material inventory
9,200
5,800
4,600
4,600
Direct material used
52,000
92,000
58,000 202,000
24,000
36,800
24,000
84,800
Direct labor
Manufacturing overhead
56,000
76,000
59,000 191,000
Total manufacturing costs
132,000
204,800
141,000 477,800
3,800
16,200
9,400
3,800
Add: Beg. Work-in-process inventory
135,800
221,000
150,400 481,600
Subtotal
16,200
9,400
17,000
17,000
Deduct: End.Work-in-process inventory
Cost of goods manufactured
$ 119,600 $ 211,600 $ 133,400 $ 464,600
9-34
Cost of Goods
Sold
April
May
June
Quarter
Cost of goods manufactured
$ 119,600 $ 211,600 $ 133,400 $ 464,600
Add: Beg. finished-goods inventory
18,400
46,000
27,600
18,400
Cost of goods available for sale
138,000
257,600
161,000 483,000
Deduct: End. finished-goods inventory
46,000
27,600
23,000
23,000
Cost of goods sold
$ 92,000 $ 230,000 $ 138,000 $ 460,000
9-35
$ 1,000,000
460,000
540,000
$ 260,000
838
$
260,838
279,162
9-36
April
May
170,000 $
400,000 $
335,000 $
905,000
(40,000)
(24,000)
(56,000)
(70,000)
-
(72,300)
(36,800)
(76,000)
(85,000)
-
(72,700)
(24,000)
(59,000)
(75,000)
(838)
(185,000)
(84,800)
(191,000)
(230,000)
(838)
(190,000)
(270,100)
(231,538)
(691,638)
(20,000) $
-
(143,700)
- $ (143,700) $
(25,000)
35,000
-
129,900 $
June
Quarter
103,462 $
213,362
(48,300)
(192,000)
(48,300) $
(192,000)
13,800
-
(48,800)
(25,000)
48,800
(48,800)
10,000 $
13,800 $
(48,800) $
(10,000) $
40,000
30,000 $
- $
30,000
30,000 $
6,362 $
30,000
36,362 $
(3,638)
40,000
36,362
9-37
Land - $50,000
Building (net) - $148,000
Common stock - $217,000
Retained earnings - $46,400
9-38
25%of June
Breakers, Inc.
sales of
$300,000
Current assets
11,500 lbs. at
$.40 per lb.
5,000 units at
$4.60 per unit.
50% of June
purchases
of $56,800
Beginning balance $ 46,400
Add: net income 279,162
Deduct: dividends (25,000)
Ending balance
$300,562
Cash
Accounts receivable
Raw materials inventory
Work-in-process inventory
Finished goods inventory
36,362
75,000
4,600
17,000
23,000
155,962
50,000
Building
148,000
Equipment
Total property and equipment
192,000
390,000
Total assets
545,962
Accounts payable
28,400
Common stock
217,000
Retained earnings
Total liabilities and equities
300,562
545,962
Production
Budget
Work in Process
and Finished
Goods
of the
Ending
Inventory
Budget
a set
becomes a financial
master
budget are
Dir ct
Materials
Direct
Labor
Budget
Budget
of mathematical
Direct Materials
expressed
Overhead
relations,Budget
planning model
as
Selling and
Administrative
it
Budget
Budget Administration
The Budget Committee is a standing
committee responsible for . . .
l
9-43
9-44
Preliminary
design.
Production.
Detailed design
and testing.
9-46
9-48
Participative Budgeting
Top Management
Middle
Management
Supervisor
Supervisor
Middle
Management
Supervisor
Supervisor