University:
McMaster University
Course:
ACC 928 | Introductory Management Accounting
Academic year:

2022
Views:

352

Pages:

3
Author:

Sabrina S.

Header: CH Master Budget & 12 Responsibility Accounting Prompt: Identify the budgets that are part of the Operating Budget Budgets: Sales Budget Production Budget Direct Materials Budget Direct Labor Budget Manufacturing Overhead Budget Operating Expenses Budget Budgeted Income Statement Capital Expenditures Budget Cash Budgets Budgeted Balance Sheet Financial Budget (connected to all other budgets) Define strategic Planning Strategic Planning involves setting long-term goals that may extend 5-10 years into the Future Prepare production budget units needed for Salar + Desired Ending Inventory Total Units Needed Units in Beginning Inventory, Units to Produce Step 1: Managers figure out how many total units they need Step 2: Managers calculate the amount of inventory they expect to have on hand at the beginning of the month Step 3: Managers calculate how many units to produce • Prepare direct materials budge Quantity of DM needed for Produskon + Desired DM Ending Inventory Total Quantity of om Needed DM Beginning Inventory Quantity of DM step 1 Management figurer out the quantity of DM needed for producion. Stepa: Managers add in the desired ending inventory of DM Step 3: Managers determine the bem inventory they expect to have on hand at the beginning of the month. step4: Substract what the company already has in stock at the beginning of the month from the tool quantity needed Step 5: Finally, management calculates the expected cost of purchasing those DM Prepor direct later budget Units to be produced X OL Houra per unit Total Di Hours Required fOL Cost per hour Total DL Cost Prepare a widgeted income statement looks like a regular income statement, except for the fact that it uses budgeted data Income Statement: Sales Revenue Cost of Goods Sold Gross Profit Operating Expenses Operating Income Interest Expense Income Tax Expense Net Income Budgets: Cash Collections Budget: Emphasizes the importance of timing. Cash Expenditure Budget: Shows the company's intentions for investments in property, plant, or equipment. Capital Expenditure Budget: Highlights potential impacts on depreciation expense, interest expense, and dividend payments. Responsibility Centers: Definition: A part or subunit of an organization with a manager accountable for specific activities. Types: Cost Center: Managers are accountable for costs only. Revenue Center: Managers are primarily accountable for revenues. Profit Center: Managers are accountable for both revenues and costs. Investment Center: Managers are responsible for generating sales, controlling costs, and efficiently managing the division's assets.