1. a)Explain what amaster budgetis, describe its contents and discuss the purposes it serves in a firm.
2. b)Calculate the budgeted net income for December.
3. c)Show the cash budget for November and December showing month-end balances for
4. each.
5. d)Describe the flow of budget data in an organization. Who are the participants in the
6. budgeting process and how do they participate? (HINT: Include a diagram of themaster
7. budget interrelationships)
8. e)Explain what is meant by the termresponsibility accounting? How does responsibility
9. accounting apply to the budgeting cycle?

Albert Park Supply, Inc. sells to companies that build buildings in a medium-sized town in Australia. Data regarding the store's operations follow: . Sales are budgeted at $400,000 for November, $450,000 for December, and $385,000 for January. . Collections are expected to be 75% in the month of sale and 23% in the month following the sale. The remaining 2%% is uncollectible and is credited to an allowance for uncollectible account in the month of the sale. . The cost of goods sold is 75% of sales. . The company purchases 28%% of its merchandise in the month prior to the month of sale and 72% in the month of sale. Payment for merchandise is made in the month following the purchase. . Other monthly expenses to be paid in cash are budgeted at $28,600. . Monthly depreciation is $18,000. . Ignore taxes. Statement of Financial Position 31-Oct Assets Cash $29,000 Accounts receivable (net of allowance for uncollectible $83,000 accounts Inventory $77,700 Property, plant and equipment (net of $502,000 accumulated $968,000 depreciation) Total assets $1,157,700 Liabilities and Stockholders' Equity Accounts payable $269,000 Common stock $800,000 Retained earnings $88,700 Total liabilities and stockholders' equity $1,157,700