1. Week 10 Presentation
in
Managerial Accounting
under
Professor Vangie Mae D. Manaois, CPA, MBA
SCHOOL OF GRADUATE AND PROFESSIONAL STUDIES
Master in Business Administration
School Year 2022-2023
3. Presenters
Zenaida S. Bautista Janny C. Dimaunahan, CPA
Bookkeeping NC III
Trainer and Assessor
Gisellyn Enrique
Technical Assistant
School Administrator
7. provides a framework for a business’ financial
objectives — typically for the next three to five years.
Planning
Budgeting
details how the plan will be carried out month to
month and covers items such as revenue,
expenses, potential cash flow and debt reduction.
8. Budgeting
Budgeting compels periodic planning.
Budgeting enhances coordination, cooperation and
communication.
Budgeting forces quantification of plans and
proposals.
Budgeting provides a framework for performance
evaluation
Budgeting enables members of the organization to
be aware of business costs.
Budgeting satisfies some legal and contractual
requirements
Budgeting directs the firm’s activities toward the
achievement of organizational goals.
1.
2.
3.
4.
5.
6.
7.
Advantages of
9. Types of
Master Budget/Profit Plan
Budgeted Financial Statements
or Pro Forma Financial
Statements
Capital Budget
Financing Budget
Rolling/Revolving/Continuous
Budgets
Zero-Base Budgeting
Budget
10. Master
represents the overall plan of the
organization for a given budget
period. It consists of all the
individual budgets for each
segment of the organization
aggregated or consolidated into
one overall budget for the entire
firm.
Budget
11. Two Major Parts of
OPERATING BUDGET
The budgeted income statement for a certain budget period. It
contains the projected revenues, costs and expenses, as well
as the forecast net income figure for a certain budget period.
Master Budget
FINANCIAL BUDGET
Usually composed of the capital expenditure budget, cash
budget and budgeted balance sheet.
12. Operating Budget
Sales budget
Ending inventories budget
Production budget
Direct materials budget
Direct labor budget
Factory overhead budget
Budgeted cost of goods sold
Selling expense budget
Administrative expense budget
Budgeted income from
operations Budgeted
nonoperating items Budgeted
net income
Financial Budget
Budgeted balance sheet
Cash budget
Capital expenditure budget
15. Wilcox Company has budgeted sales volume of 60,000 units
and budgeted production of 54,000 units, while 10,000 units are
in beginning finished goods inventory. How many units are
targeted for ending finished goods inventory?
Sample Illustration....
16. Wilcox Company has budgeted sales volume of 60,000 units
and budgeted production of 54,000 units, while 10,000 units are
in beginning finished goods inventory. How many units are
targeted for ending finished goods inventory?
Sample Illustration....
ANSWER: 4,000
17. Wilcox Company has
budgeted sales volume of
60,000 units and budgeted
production of 54,000 units,
while 10,000 units are in
beginning finished goods
inventory. How many units
are targeted for ending
finished goods inventory?
Solutions....
10,000
54,000
60,000
4,000
18. Calypso Co. has projected sales to be P600,000 in
January, P750,000 in February, and P800,000 in March.
Calypso wants to have 50% of next month's sales
needs on hand at the end of a month. If Calypso has
an average gross profit of 40%, what are the February
28 purchases?
Sample Illustration....
19. Calypso Co. has projected sales to be P600,000 in
January, P750,000 in February, and P800,000 in March.
Calypso wants to have 50% of next month's sales
needs on hand at the end of a month. If Calypso has
an average gross profit of 40%, what are the February
28 purchases?
Sample Illustration....
ANSWER: 465,000
20. Calypso Co. has projected
sales to be P600,000 in
January, P750,000 in
February, and P800,000 in
March. Calypso wants to
have 50% of next month's
sales needs on hand at the
end of a month. If Calypso
has an average gross profit
of 40%, what are the
February 28 purchases?
Solutions....
Beginning February
750,000 x 50% x 60% = 225,000
Sales of February
750,000 x 60% = 450,000
Ending February
800,000 x 50% x 60% = 240,000
21. Solutions....
Beginning February
750,000 x 50% x 60% = 225,000
Sales of February
750,000 x 60% = 450,000
Ending February
800,000 x 50% x 60% = 240,000
225,000 450,000
240,000
465,000
22. Answer the following questions using the information below:
Kason, Inc., expects to sell 20,000 pool cues for $24.00 each. Direct materials costs
are $4.00, direct manufacturing labor is $8.00, and manufacturing overhead is
$1.60 per pool cue. The following inventory levels apply to 2021:
Beginning inventory Ending inventory
Direct materials 24,000 units 24,000 units
Work-in-process 0 units 0 units
Finished goods 2,000 units 2,500 units
1) On the 2022 budgeted income statement, what amount will be reported for
sales?
2) How many pool cues need to be produced in 2022?
3) On the 2022 budgeted income statement, what amount will be reported for cost
of goods sold?
Sample Illustration....
23. Answer the following questions using the information below:
Kason, Inc., expects to sell 20,000 pool cues for $24.00 each. Direct materials costs
are $4.00, direct manufacturing labor is $8.00, and manufacturing overhead is
$1.60 per pool cue. The following inventory levels apply to 2021:
Beginning inventory Ending inventory
Direct materials 24,000 units 24,000 units
Work-in-process 0 units 0 units
Finished goods 2,000 units 2,500 units
1) On the 2022 budgeted income statement, what amount will be reported for
sales?
Sample Illustration....
ANSWER: 480,000
20,000 X 24
24. Answer the following questions using the information below:
Kason, Inc., expects to sell 20,000 pool cues for $24.00 each. Direct materials costs
are $4.00, direct manufacturing labor is $8.00, and manufacturing overhead is
$1.60 per pool cue. The following inventory levels apply to 2021:
Beginning inventory Ending inventory
Direct materials 24,000 units 24,000 units
Work-in-process 0 units 0 units
Finished goods 2,000 units 2,500 units
2) How many pool cues need to be produced in 2022?
Sample Illustration....
ANSWER: 20,500
2,000
2,500
20,000
20,500
25. Answer the following questions using the information below:
Kason, Inc., expects to sell 20,000 pool cues for $24.00 each. Direct materials costs
are $4.00, direct manufacturing labor is $8.00, and manufacturing overhead is
$1.60 per pool cue. The following inventory levels apply to 2021:
Beginning inventory Ending inventory
Direct materials 24,000 units 24,000 units
Work-in-process 0 units 0 units
Finished goods 2,000 units 2,500 units
3) On the 2022 budgeted income statement, what amount will be reported for cost
of goods sold?
Sample Illustration....
ANSWER: 272,000
20,000 X (4 + 8 + 1.6)
