A client of a small business comes to you and asks for help with budgeting. The business owner, Taylor, is looking for funds to finance a food truck operation. Taylor has an investor who is interested in offering financing and would like to see a master budget plan for the food truck’s first year of operations. Taylor comes to your accounting business and asks for help with creating a master budget to show the investor.

Taylor is a chef and knows how to prepare food, but does not know much about budgets. He needs the budget plan in three days. Before Taylor goes, he leaves a small piece of paper on your desk. It says $500,000 sales, $100,000 earnings. You begin to plan. How will you prepare the master budget for Taylor’s business?

• Do you have enough information to prepare the master budget?
• If not, where will you get the information needed?
• How will you put the information together and present it to Taylor?
• How will you know if it is a good master budget?

Given your understanding of preparing a master budget, explain how you would begin the process. Address the four bullet items above.