It is October, 2017 and you, the budget manager just received an e-mail from the CFO, asking you to put together a 2018 budget. The projected 2017 financial information is below. Now you need to prepare a 2018 budget by filling in the boxes below and submitting to the CFO. So what to fill in? Using the sequence of events in a Master Budget, you should seek information and input from your company's: Sales Manager Production Manager Administration Manager This information (although reflecting real-world vagueness and uncertainty) is in the detail below: 2017 :

				2017 Projected		2018 Budget
Sales				$ 2,200,000		?
Cost of Sales:
Direct Material				630,000		?
Direct Labor				420,000		?
Manufacturing Overhead				80,000		?
Other Expenses:
Sales commissions				440,000		?
Office/Mgmt Salaries				300,000		?
Rent				120,000		?
Utilities				6,000		?
Supplies				25,000		?
All Other				56,000		?
Total expenses				2,077,000		?
Net Income				123,000		?

Budget input from key personnel:
SALES MANAGER
The Sales Manager is in charge of sales of wire shelving in linear feet (the key metric for this business)..
She solicits and receive orders from home builders and chain stores
The following is projected sales data for (full year) 2017:
190,000 linear feet to the home builders at a sales price of $10 per linear foot.
20.000 linear feet to the chain store market at a sales price of $15 per linear foot.
For 2018, a continued "slump" in the builders market is expected,
but the chain store market is expected to improve.
Sales prices (what is charged to the customers) per linear foot will remain the same in 2019.
PRODUCTION MANAGER
The production manager is in charge of assembly of these units in the assembly
facility adjacent to the office.
Production at the company facility is based on the assembly of the shelving by the linear foot.
You assemble what you need to fill orders, since there is no space for unsold inventory.
The production manager is also responsible for procurement of the raw materials (metal).
You currently pay at a rate of $3 per linear foot, but your supplier is planning a price increase.
The production manager is also responsible for the assemblers that he directly supervises.
They are paid by production at $2 per linear foot.
The production manager earns an $80,000 salary (which is manufacturing overhead) and wants
a raise in pay.
Reminder: direct material and direct labor are both variable costs - An appropriate budget would
be based on expected cost per linear foot x the number of expected linear feet in sales
(based on the input from the sales manager)
ADMINISTRATION MANAGER
The administration manager is in charge of basically everything at your facility except sales
and production.
A couple of the issues she is working on include:
Negotiating with the landlord - your lease is up in December and he wants to increase the rent.
Hiring an administrative assistant to help implement the new accounts payable software.
Reminder: sales commissions are variable and based on a % of sales (in dollars)