Cost, Budgets and Strategic Decision Making in Management Accounting Assignment

Cost, Budgets and Strategic Decision Making in watchfulness Accounting - Assignment ExampleThe projected next periods revenues ar normally grounded on the prior story periods actual revenue trends.Second, the production facility budget is prepared. The production budget is grounded on the projected next accounting periods revenues. If the next accounting periods pass judgment revenues is 50 cars and the last months unsold cars is 15 cars, then the production budget go forth be to produce only the remaining 35 cars 50 cars revenue 15 unsold cars from the prior accounting period = 35 cars (Warren, 2015).Third, the condition materials budget and labor budget are prepared (Warren, 2015). The direct materials are used as part of the unblemished product. If each car needs 2 female genitalss of paint and in that location are 17 cans of paint remaining from the prior accounting period, the company must purchase 53 paint cans (35 cars x 2 cans per car 17 cans from prior accounting period = 53 new can purchases). If one can apostrophizes 5, then the budget for the next accounting period includes 265 (53 cans of paint x 5 per can). The labor costs must be included in the budget (Warren, 2015). The labor cost is the salary of the workers directly making the products, the car painters.Furthermore, the factory overhead budget is computed (Kinney, 2012). The factory overhead is comprise of all other costs that do not fall under direct materials or direct labor classification. This includes the indirect materials figures and indirect labor amounts. The other amounts include the factory Janitors salaries, electricity payments, water payments, and call amounts.Next, the selling and administration expense budget is prepared (Bromwich, 2009). The selling expense budget includes the amounts allocated to sell the finished products, including the cars. The selling expense budget includes the sales departments salaries and commissions, advertising, and other sales depa rtment expenses. The