Question

Assume that The AM Bakery is preparing a budget for the month ending October 31. Management prepares the budget by starting with the actua/results for August 31. Next, management considers what the differences in costs will be between August and October Management expects revenue in October to be 10 percent more than in August, and it expects all ingredient costs (e.g., four, butter. and so on) to be 10 percent higher in October than in August. Management expects "other" labor costs to be 20 percent higher in October than in August, partly because more labor will be required in October and partly because employees will receive a pay raise. The manager will receive a pay raise that will increase his salary from $5.600 in August to $6,210 in October. Rent, utilities, and marketing costs are not expected to change. Required: Prepare a budget for The AM Bakery for October

Answer 1

Answer: * prepare a budget for the Am Bakery for october : calculation of budget :- flour = $5,000 x 1104 =5500 Butter = U, GOO X1104. - 5060 oil = 2,800 x 1101. = 3080 fruit = 2,400x not = 2640 Nuts = 2,000x1101. = 9200 chocolate = 1,350 X1101). = 1485 Othor = 9.50 11001 - 1045 Labor Other = 11,800 x 120). =14160 Revenues = 63,200 X 1104 ... = 69520

opes ..amin budget for the month Ending oct 21 S particulars: Actual Coug) (4) beadget Coci) (1) ingredients flour 51 $ 5500 butter 1600 oil . 218.00 3080 fruit 2.800 2640 Nuts. 2,000 2900 chocolate 1350 1485 : 950 other $19,100 $21,010 Total Pengacdients Labor channel manager $ 5,600 $ 6210 11.800 14,160 Utilities 3.500 3,500 Rent 4700 marketing 750 7.50 To-lal bakery kost $ 45, 450 $50,330 I Revenues 63,200 $69.590 10u5 mavarovainen 4,900