Sunday, November 21, 2010

what is master budget in managerial accounting


what is master budget in managerial accounting?
this is a homework question of introduction to managerial accounting, the name of the chapter is "operating budgets: bridging planning and control". the teacher wants us to work on an example that a university library prepares an annual master budget, and asks us to prepare 3 individual budgets that would be part of the master budget the thing is I really don't understand what a master budget means. so i dont even understand the hint from the teacher that "direct labor budget and direct material budget won't make sense here" anyone can give me a clue so i can continue with the homework?
Higher Education (University +) - 1 Answers

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The master budget lays out the general expenses and income for the whole library. The individual budgets use their alloted amounts under the master budget to figure out their own division's expenses and income.

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