Business Administration - Human Resources HRA734 Chapter 6: HRA734 | CH6
1 Dec 2016
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Document Summary
In a zero-based budget, mangers are required to justify all costs as if the programs involved were being proposed for the first time. Top managers and lower-level managers are involved in developing budgets. In a manufacturing company, the direct material budget details the raw materials that must be purchased to fulfill the production budget and provide for adequate inventories. In a manufacturing company, the production budget lists the number of units that must be produced to satisfy sales needs and to provide for the desired ending inventory. The manufacturing budget shows all costs of production other than direct material and direct labour. Direct materials budget, direct labour budget, and manufacturing overhead budget are needed to calculate unit product costs. Responsibility accounting holds managers accountable for revenues and costs. Beginning inventory of raw materials, raw materials required per unit are needed to calculate raw materials to be purchased on the direct materials budget.
