Master Budgets


Overview/Description
Target Audience
Expected Duration
Lesson Objectives
Course Number


Overview/Description
Will you be able to expand? Will you be able to afford that new piece of equipment? What kind of profit can be expected if you do? To answer these questions about your business will not require a fortune teller. It will require the creation of a master budget. No matter the size of your company, if you are to succeed and continue to grow, you must carefully plan for your company's future. Master budgets can be used to predict the future success of your company and serve as a overall plan to indicate in which direction your company should grow.

Target Audience
Individuals who require knowledge of the basics of accounting, who are starting a business or interested in becoming a partner, who are learning to manage the accounting activities of a business, and who need to review accounting principles and procedures. Shareholders or people who are interested in becoming a shareholder can also benefit from this course.

Expected Duration (hours)
4.0

Lesson Objectives

Operating Budgets

  • recognize the importance of using an operating budget.
  • apply the steps necessary to create a sales budget for a given company.
  • label examples of just-in-time and safety stock inventory systems.
  • apply the steps to creating a merchandise purchases budget, for a given company.
  • apply the steps to preparing a production budget, for a given company.
  • apply the steps to creating the three sub-budgets of the manufacturing budgets, given a scenario.
  • calculate the depreciation of a given company's assets.
  • calculate the total selling expense for a given scenario.
  • apply the steps to creating a general and administrative budget, for a given company.

    • Capital Expenditures Budget

  • recognize the advantages of using a capital expenditures budget to plan for the future.
  • analyze two different investments to determine which would be the best one for a given company to pursue, based on the payback period.
  • compare investments to determine which is the best one for a given company, based on the net present value.
  • analyze two investments to determine which would be the best one for a given company based on its rate of return.

    • Financial Budgets

  • recognize the advantages of preparing financial budgets.
  • apply the steps to complete a three month cash budget, for a given company.
  • calculate the forecasted net income for a given company's budget period, given the revenue and expenses.
  • calculate the forecasted owner's equity from a budgeted balance sheet.

    • Course Number:
    FIN0224