From the course: Accounting Foundations: Budgeting

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Developing a sales budget for a service firm

Developing a sales budget for a service firm

From the course: Accounting Foundations: Budgeting

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Developing a sales budget for a service firm

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- Each year, service companies are becoming a larger and larger percentage of business in the United States and worldwide. Service companies differ from manufacturing or merchandising companies in that they provide services to customers instead of a product. Some common service businesses are as follows. Law, accounting, engineering firms, doctors, dentists, hotels, motels, hunting and fishing guide services, automotive, home, and appliance repair services, internet providers, those are service companies. So here's a thought question for you. Is McDonald's a service business, a merchandising business, or a manufacturing business? Think about that for a second. The answer is that McDonald's has elements of all three types of business. McDonald's manufactures the food that you buy. You watch them do it right in front of you. So there's an element of manufacturing. McDonald's provides a service, because they prepare for you the food and deliver it in a rapid, ready to eat fashion, so…

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