Acc 561 Master Budget Paper
Accessed Discussion Question: Master Budget 1
Accessed Discussion Question: Master Budget
Michael Jordan
University of Phoenix
Accounting 561
Dr. Trillion Cason
October 13, 2009
The master budget is a detailed and comprehensive analysis of an organization’s long and short term goals.
1. Identify the major inputs to the master budgets and the usefulness of each.
Operational budget and financial budget are the two major parts of the master budget.
The financial budget focuses on the income statement and its supporting schedules or, in an organization with no sales revenues, on budgeted expenses and supporting schedules.
The financial budget focuses on the effects that the operating budget and …show more content…
Disadvantages of budgets are:
• Employees fail to accept responsibility in making a reasonable budget for there department in the company.
• There are strong temptations to lie and cheat in the budget process to get possible bonuses.
• I is very difficult of calculate accurate sales forecasts. • • 1. In what ways do the elements of the four financial statements interact with one another? • The four financial statements share the same information in certain areas of the statement which leads to better understanding a company’s finances. For example, the income statement explains the net income (revenue-expense) and that number increase the ending retaining earning on the Statement of Retaining Earning Sheet. Furthermore, retaining earning is on the balance sheet which helps determining stockholders equity & total liabilities. The ending cash amount on the statement of cash flows gives the beginning cash balance on the balance sheet. This example show how all the financial statements relate to one another. • • 2. How might changing one of the four financial statements affect the other financial
Accessed Discussion Question: Master Budget
Michael Jordan
University of Phoenix
Accounting 561
Dr. Trillion Cason
October 13, 2009
The master budget is a detailed and comprehensive analysis of an organization’s long and short term goals.
1. Identify the major inputs to the master budgets and the usefulness of each.
Operational budget and financial budget are the two major parts of the master budget.
The financial budget focuses on the income statement and its supporting schedules or, in an organization with no sales revenues, on budgeted expenses and supporting schedules.
The financial budget focuses on the effects that the operating budget and …show more content…
Disadvantages of budgets are:
• Employees fail to accept responsibility in making a reasonable budget for there department in the company.
• There are strong temptations to lie and cheat in the budget process to get possible bonuses.
• I is very difficult of calculate accurate sales forecasts. • • 1. In what ways do the elements of the four financial statements interact with one another? • The four financial statements share the same information in certain areas of the statement which leads to better understanding a company’s finances. For example, the income statement explains the net income (revenue-expense) and that number increase the ending retaining earning on the Statement of Retaining Earning Sheet. Furthermore, retaining earning is on the balance sheet which helps determining stockholders equity & total liabilities. The ending cash amount on the statement of cash flows gives the beginning cash balance on the balance sheet. This example show how all the financial statements relate to one another. • • 2. How might changing one of the four financial statements affect the other financial