In Paige Company, direct labor is $20 per hour. The company expects to operate at 10,000 direct labor hours each month. In January 2014, direct labor totaling $204,000 is incurred in working 10,400 hours. Prepare (a) a static budget report and (b) a fl exible budget report. Evaluate the usefulness of each report.
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.
In Paige Company, direct labor is $20 per hour. The company expects to operate
at 10,000 direct labor hours each month. In January 2014, direct labor totaling $204,000
is incurred in working 10,400 hours. Prepare (a) a static budget report and (b) a fl exible
budget report. Evaluate the usefulness of each report.
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