Intro to Master Budget AGEC 489/689 Spring 2009 Slide Show #4

Master Budget Preparation Annual operating budgetsAnnual operating budgets –Sales budget: number of units sold –Production budget: output and inventory –Direct materials budget: materials used –Direct labor budget: labor used –Other budgets: selling and administrative –Inputs to preparing the cash budget Other annual budgets and statementsOther annual budgets and statements –Capital expenditure budget –Preparing budgeted cash flow statement –Preparing budgeted income statement –Preparing budgeted year end balance sheet

Sales Budget

Production Budget

Sales Budget Production Budget Direct Materials Budget Direct Materials Budget Direct Labor Budget Direct Labor Budget Overhead Budget Overhead Budget

Sales Budget Production Budget Direct Materials Budget Direct Materials Budget Direct Labor Budget Direct Labor Budget Overhead Budget Overhead Budget Selling and Administrative Expense Budget Selling and Administrative Expense Budget

Sales Budget Production Budget Direct Materials Budget Direct Materials Budget Direct Labor Budget Direct Labor Budget Overhead Budget Overhead Budget Selling and Administrative Expense Budget Selling and Administrative Expense Budget Capital Expenditure and Cash Budgets Capital Expenditure and Cash Budgets

Sales Budget Production Budget Direct Materials Budget Direct Materials Budget Direct Labor Budget Direct Labor Budget Overhead Budget Overhead Budget Selling and Administrative Expense Budget Selling and Administrative Expense Budget Capital Expenditure and Cash Budgets Capital Expenditure and Cash Budgets Budgeted Cash Flow Statement

Sales Budget Production Budget Direct Materials Budget Direct Materials Budget Direct Labor Budget Direct Labor Budget Overhead Budget Overhead Budget Selling and Administrative Expense Budget Selling and Administrative Expense Budget Budgeted Income Statement Budgeted Income Statement Capital Expenditure and Cash Budgets Capital Expenditure and Cash Budgets Budgeted Cash Flow Statement

Sales Budget Production Budget Direct Materials Budget Direct Materials Budget Direct Labor Budget Direct Labor Budget Overhead Budget Overhead Budget Selling and Administrative Expense Budget Selling and Administrative Expense Budget Budgeted Income Statement Budgeted Income Statement Capital Expenditure and Cash Budgets Capital Expenditure and Cash Budgets Budgeted Cash Flow Statement Budgeted Balance Sheet Budgeted Balance Sheet