budget planning and control
1. Briefly discuss the ways a good budget will benefit the owner of babycakes versus no budget. Use the specific company and product details in your explanation.
2. Prepare a Sales Budget for the LA store for 4th quarter of 2016 for babycakes. Present the number of units, sales price, and total sales for each month; October, November, and December, and a total for the quarter. Use one half of the Valentine’s Day (one day) of sales as the basis for a normal day of one product. This information is in the babycakes video provided in Week 8.
3. Create three (3) new products, one for each of the three (3) holiday seasons in the fourth quarter. Estimate the sales units, sales price, and total sales for each month. Describe the assumptions used to make these estimates. Include an overview of the budget in the report, presenting the actual budget as an appendix with all data and calculations.
4. The owner of babycakes is interested in preparing a flexible budget rather than the static budget she currently uses. She does not understand why when sales increase her static budget often shows an unfavorable variance. Explain how a flexible budget will overcome this problem. Use the details of your newly prepared budget for the 4th quarter of 2016 to address her concern.
5. Imagine that babycakes is facing a financial challenge that is causing the actual amounts of money that it spends to become signifcantly more than its budgeted amounts. Include a discussion of your own unique cause of the overspending. Explain the corrective actions needed to correct the challenge .
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