About This Chapter
Budgetary Process - Chapter Summary
Use this comprehensive overview of the budgetary process to learn about types of budgets, how to prepare budgeted income statements and balance sheets, and other important budgeting concepts. The lessons in this chapter are easy to navigate and fun to review. Explore them in any order, and visit them as many times as you'd like. Multiple-choice quizzes accompanying the lessons enable you to quickly and easily assess your comprehension of the concepts they cover. A chapter exam is also available to test your understanding of the budgetary process.
Once you've completed this chapter, you will be able to:
- Analyze the purpose of the master budget and break down its components
- Explain and uses of operating, sales, and production budgets
- Outline the process of preparing a direct materials budget
- Prepare direct materials, direct labor, and manufacturing overhead budgets
- Compose a selling and administrative expense budget
- Summarize the importance and uses of capital budgeting
- Evaluate major factors that influence the budgeting process
- Create a budgeted income statement
- Design a capital expenditure budget
- Formulate a budgeted balance sheet using the correct format
1. Master Budget in Accounting: Definition, Components & Example
In this lesson, we'll outline the major components of a master budget and look at an example that shows how a company's individual budgets relate to each other and can be used to form a strategic plan for a company.
2. What Is Operating Budget? - Definition & Examples
What are operating budgets? In this lesson, learn about how operating budgets are created and explore how they can be used to help businesses succeed. Some examples will be given.
3. Sales Budget: Definition & Examples
The sales budget is often the first document that a company produces for accounting purposes, and is also one of the most important ones to be made. Learn all about it in this lesson on sales budgets.
4. Production Budget: Preparation & Examples
Every time a company creates a sales budget, a production budget can't be too far behind. In this lesson, we look at the importance of the production budget and why it is always the second budget created.
5. Preparing a Direct Materials Budget
One of the most important budgets that a company puts together is the direct materials budget. Not only does it show how many raw materials are required, but also the cost for producing the goods a company makes.
6. Direct Labor Budget: Definition, Example & Formula
Companies require plenty of budgets, but one of the most important is the direct labor budget. In this lesson, we see how it is used to do everything from planning vacations to hiring new employees.
7. Manufacturing Overhead Budget: Definition, Preparation & Example
In this lesson you'll learn how to make a manufacturing overhead budget for your business. Learn what things you need to include and what things are linked to other budgets.
8. Preparing a Selling & Administrative Expense Budget
Even though it has nothing to do with the actual manufacture of goods, a selling and administrative expense budget is often one of the largest budgets that a company produces. Learn more about selling and administrative expense budgets in this lesson.
9. What Is Capital Budgeting? - Techniques, Analysis & Examples
Capital budgeting is important to the growth and development of a business. In this lesson, you will learn what capital budgeting is, why it is important, and how it is used.
10. Major Factors Influencing the Budgeting Process
A great deal of work goes into preparing a budget. In this lesson, we'll look at influences on a budget, ranging from how the structure of the organization affects the process to the role of responsibility centers.
11. Preparing a Budgeted Income Statement
One of the most important statements that a company produces is the budgeted income statement. In this lesson, learn how it is made, why it is so important, and what companies can learn from these statements.
12. Capital Expenditure Budget: Definition & Preparation
Since companies must constantly upgrade and update their equipment, it's no surprise that the capital expenditure budget is one of the most important documents that a company will produce. Learn more about it in this lesson.
13. Preparing & Formatting a Budgeted Balance Sheet
One of the most important documents that a business can produce is the budgeted balance sheet. In this lesson, we'll learn how to make one, as well as what each section contains and where the numbers come from.
14. Required Assignments Reminder
Sorry for the interruption to your course progress! We wanted to make sure you knew this course has a written assignment requirement in order to be completed. Read on to learn where to find these assignments and how to submit them.
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Other chapters within the Accounting 303: Cost Accounting course
- Cost Classifications in Accounting
- Costing Methods & Techniques
- Formulas for Cost Accounting
- Standard Costs in Accounting
- Job Order Cost System in Accounting
- Process Cost System in Accounting
- Activity-Based Costing Overview
- Product & Service Costing
- Cost Behavior Analysis
- Cost-Volume-Profit Analysis Overview
- Cost Estimation
- Service Department & Joint Cost Allocation
- Cost Accounting for Decision Making
- Ethics in Cost Accounting
- Modern Trends in Accounting
- Required Assignments for Accounting 303
- Studying for Accounting 303