Professional Documents
Culture Documents
CHAPTER 8
Managerial Accounting
Seventeenth edition
8-2
Learning Objective 1
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8-4
Operating Budget
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8-5
Planning – Control –
involves developing involves the steps taken by
objectives and preparing management to increase the
various budgets to likelihood that the objectives
achieve those set down while planning are
objectives. attained and that all parts of
the organization are working
together toward that goal.
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8-6
Define goals
and objectives
Communicate Think about and
plans plan for the future
Benefits
Coordinate Means of allocating
activities resources
Uncover potential
bottlenecks
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8-9
Self-Imposed Budgets
Top Management
Middle Middle
Management Management
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8-11
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8-12
Selling and
Ending inventory administrative
Production budget
budget budget
Cash Budget
Budgeted
Budgeted
income
balance sheet
statement
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8-13
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8-17
Learning Objective 2
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8-18
Budgeting Example
Royal Company is preparing budgets for the
quarter ending June 30th.
Budgeted sales for the next five months are:
April 20,000 units
May 50,000 units
June 30,000 units
July 25,000 units
August 15,000 units
The selling price is $10 per unit.
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8-19
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8-20
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8-21
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8-22
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8-23
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8-24
Quick Check 1
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8-25
Quick Check 1a
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8-26
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8-27
Learning Objective 3
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8-28
Sales
Budget
Production
and
Budget
Expected
Cash
Collections
The production budget must be adequate to
meet budgeted sales and to provide for
the desired ending inventory.
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8-30
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8-31
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8-32
Quick Check 2
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8-33
Quick Check 2a
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8-34
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8-35
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8-36
Learning Objective 4
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8-37
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8-39
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8-40
March 31 inventory.
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8-41
Quick Check 3
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8-42
Quick Check 3a
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8-43
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8-44
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8-45
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8-46
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8-47
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8-48
Quick Check 4
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8-49
Quick Check 4a
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8-50
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8-51
Learning Objective 5
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8-52
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8-53
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8-54
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8-55
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8-56
Learning Objective 6
Prepare a manufacturing
overhead budget.
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8-57
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8-59
* rounded
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8-60
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8-61
Direct materials
budget and information.
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further distribution permitted without the prior written consent of McGraw-Hill Education.
8-62
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8-63
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8-64
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8-65
Production Budget.
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8-66
Learning Objective 7
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8-67
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8-68
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8-69
Quick Check 6
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8-70
Quick Check 6a
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8-71
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8-72
Learning Objective 8
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8-74
Schedule of Expected
Cash Collections.
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8-76
Schedule of Expected
Cash Disbursements.
Manufacturing
Overhead Budget.
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8-77
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8-78
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8-80
Quick Check 7
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8-81
Quick Check 7a
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8-82
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8-83
Cash Budgeted
Budget Income
Statement
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8-84
Learning Objective 9
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8-85
Cash Budget.
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8-86
Learning Objective 10
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8-87
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8-88
11,500 lbs.
at $0.40/lb.
5,000 units
at $4.99 each.
50% of June
purchases
of $56,800.
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8-89
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End of Chapter 8
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