Join Jim Stice for an in-depth discussion in this video The production budget, part of Accounting Foundations: Budgeting.
- After the sales budget is completed,…the second detailed budget covers the number…of units to be produced during the period.…Three factors need to be considered…in preparing this production budget.…First, the projected sales volume for the period.…Second, the desired amount of ending inventory.…And third, the amount of inventory already on hand…in the beginning inventory.…Ending inventory is an important figure,…because management wants enough units on hand…to meet customer demands,…but not so many that unnecessary costs will be incurred…because of excessive inventory.…
So let's consider the question,…"Why does a manufacturer want ending inventory?"…On one side, what if we run out of finished goods?…We'll have lost sales, perhaps now and forever.…We'll also have lost reputation.…But on the other hand,…what if we have too many finished goods?…We'll have excess resources tied up in inventory.…The inventory could get old and obsolete,…eventually having to be sold at a loss.…And where do we store all these extra fishing boats?…
Released
7/23/2015This course covers purchase budgets, production budgets, hiring budgets, overhead budgets, and cash budgets. Professors Jim and Kay Stice help you weigh the impact of strict versus more moderate budgeting on employee morale, and show how budgets pay off in the future, when you can use them to evaluate your business performance.
- Understanding the budgeting process
- Involving other people
- Creating a manufacturing budget
- Budgeting for merchandising and service firms
- Budgeting cash flow
- Using a flexible budget
Skill Level Appropriate for all
Duration
Views
Related Courses
-
Finance Essentials for Small Business
with Jim Stice54m 33s Appropriate for all -
Accounting Foundations (2014)
with Earl Kay Stice2h 46m Appropriate for all -
Supply Chain Foundations
with Eddie Davila1h 42m Appropriate for all -
Accounting Foundations: Bookkeeping
with Jim Stice1h 27m Beginner
-
Introduction
-
Welcome1m 54s
-
-
1. The Budgeting Process in Organizations
-
The budgeting process3m 34s
-
2. Budgeting: Manufacturing
-
The master budget5m 20s
-
The sales budget5m 35s
-
The production budget3m 22s
-
The direct materials budget5m 21s
-
The direct labor budget2m 40s
-
3. Budgeting: Merchandising and Service
-
Sales budget: Service firm5m 15s
-
Supplies and labor: Service2m 45s
-
Overhead and SG&A: Service4m 35s
-
4. Cash Flow Budgeting
-
Financing2m 21s
-
5. Flexible Budgeting
-
Using the right benchmark2m 44s
-
Using the flexible budget2m 49s
-
-
Conclusion
-
Wrap-up2m
-
- Mark as unwatched
- Mark all as unwatched
Are you sure you want to mark all the videos in this course as unwatched?
This will not affect your course history, your reports, or your certificates of completion for this course.
CancelTake notes with your new membership!
Type in the entry box, then click Enter to save your note.
1:30Press on any video thumbnail to jump immediately to the timecode shown.
Notes are saved with you account but can also be exported as plain text, MS Word, PDF, Google Doc, or Evernote.
Share this video
Embed this video
Video: The production budget