A. An increase in gross revenue does not needfully cogitate that there is a rise in temporal or working class cost. We must know what the document level is at the particular time of the rise in gross revenue. If the inventory levels do not permit or concord with the sales figures, we rear end assume that there is whatsoever rise in trus dickensrthy be; such as tell labor. The rise in costs would be direct labor depending on what the output or the maximum faculty rating (MCR). If the increase in sales rises, is the company suitable to produce these products in the frequent time? On the other hand, must they work extra time to adjust for the sales increase? In the case of Salud Foods, the sales increased $450,000; which inescapably led to an increase in labor by 20%. B. The financial managers task is to forecast rising sources and uses of gold. These forecasts serve two purposes. First, they alert the financial manager to proximo cash needs. Second, the cash flow for ecasts provide a standard, or a cipher, against which subsequent performance can be judged (Brealey, Myers, and Marcus). The the true in the budgeting bear on is only as good as the forecaster tuition provided.
As with the Salud Foods company, they had at least common chord pile involved in the budgeting decisions, who were all from different divisions so that we could look fair concise input to the accuracy of the budget. C. A Companys budget can be hidden from certain costs if the be after and forecasting took into account some of the issues that may make set out during a certain period. Example with Salud Foods, t heir sales in creased, they knew this guid! e of time and had to budget for that issue. Some of the issues that they did not count on was the... If you want to get a full essay, order it on our website:
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