A. You are given the following information related to ABC manufacturing company Month Budgeted Sales March $200,000
Question:
A. You are given the following information related to ABC manufacturing company
Month Budgeted Sales
March $200,000
April 212,000
May 204,000
June 218,000
July 210,000
In addition, the gross profit rate is 40% and the desired inventory level is 30% of next month's cost of sales.
Required:
Prepare a purchases budget for April through June.
B 1. Explain the concept of responsibility accounting and its relation with budgeting.
2. Explain how the choice of the type of responsibility center (cost, revenue, profit, or investment) affects behavior.
3. Discuss the concept of “budgetary slack”
Accounting Principles
ISBN: 978-1119048503
7th Canadian Edition Volume 1
Authors: Jerry J. Weygandt, Donald E. Kieso, Paul D. Kimmel, Barbara Trenholm, Valerie Warren, Lori Novak