Answer: True
Explanation:
According to the Solow Model, Savings and Investment determine the level of Output, Income and Capital. If these two countries are similar in savings and Investment as well as underlying factors such as population and population growth, it can be said for certain that they should both have the same output. Output per worker is equal in both countries.
A higher price point should create value for the customer. The buyers need to know that they are paying for __________, or an unforgettable experience. The product itself must live up to these expectations.
Answer:
Differentiation.
Explanation:
The concept of value for the customer corresponds to the expectation that the product will meet the needs, desires and features that he expects.
The customer's perception of the concept of value is affected in rational and irrational ways, such as brand image, product performance, high price, etc.
Therefore, when a company offers a product at a higher price, it is passing on to the consumer the higher production cost of an item, which has features that add greater value and functionality, such as differentiation, personalization or an unforgettable customer experience.
Differentiated products are those produced in a more heterogeneous way compared to standard products, therefore differentiated products have distinct characteristics that add greater value, such as new features, technology, design, durability, style, etc.
If the next year’s dividend is forecast to be $5.00, the constant growth rate is 4%, and the discount rate is 16%, then the current stock price should be:
Answer:
The answer is $41.67
Explanation:
Po = D1/r - g. This formula is called Discount Dividend Model and it is one of the methods used in valuing company's stock.
Po is the present or current value of the stock
D1 is the next year dividend payment
r is the discount rate
g is the growth rate.
Po = $5.00 /0.16 - 0.04
= $5.00/0.12
=$41.67
Therefore, the current stock price is $41.67
Health Care Event Protection
Christina Haley of San Marcos, Texas, age 57, recently suffered a stroke. She was in intensive care for 3 days and was hospitalized for 10 more days. Her total bill for this care was $135,500. After being discharged from the hospital, she spent 25 days in a nursing home at a cost of $170 per day. Christina, who earns $4,500 per month, missed two months of work. Christina had a health insurance plan through her employer. The policy had a $1,000 deductible and an 80/20 coinsurance clause with a $2,000 coinsurance cap. She had also accumulated 21 sick days (equivalent to one month) at work. Otherwise she had no long-term care or disability income insurance.
1. How much of Christina’s direct medical expenses was paid by her insurance policy?
2. What did Christina have to pay for her nursing home care?
3. How much income did Christina lose?
Answer:
$ 132,500
$4,250
$9000
Explanation:
From the given information:
Christina Haley of San Marcos who's aged 57 years recently suffered from stroke.
She was in intensive care for 3 days and was hospitalized for 10 more days
Total bill = $135,500
After Discharge;
she spent 25 days in a nursing home at a cost of $170 per day
Amount earned by Christiana per month at her work = $4500
She missed 2 months of going to work.
Christina had a health insurance plan through her employer.
The policy had a $1,000 deductible and an 80/20 coinsurance clause with a $2,000 coinsurance cap
1. How much of Christina’s direct medical expenses was paid by her insurance policy?
The amount the insurance policy paid can be known by the expression:
= Total bill amount for the care - deduction for policy - coinsurance cap
= $135,000 - $1000 - $2,000
= $ 132,500
2. What did Christina have to pay for her nursing home care?
We are being told that She spent 25 days in a nursing home at a cost of $170 per day
Thus; the amount Christina have to pay for her nursing home care = 25 × $ 170
= $4,250
3. How much income did Christina lose?
We knew she missed two months from work and she collect $4500 per month.
Thus the amount of income she lose = $4500 × 2
the amount of income she lose = $9000
A sharp increase in interest rates will decrease the price of bonds and increase the interest income available to new bondholders. This will increase the demand for bonds compared to the demand for stocks, all other considerations remaining constant.
A. True
B. False
The sensitivity parameter in the consumption function that measures how sensitive consumption is to changes in consumer confidence is referred to as the marginal propensity to consume.
a. True
b. False
Answer: False
Explanation:
The Sensitivity Parameter that measures the sensitivity of changes in consumption to changes in consumer confidence is not the Marginal Propensity to Consume.
The Marginal Propensity to Consume rather measures what proportion of additional income is spent on consumption. For example, if you earn an extra $50 this month and you spend $40, the Marginal Propensity to Consume is 40/50 = 0.8.
Jake recently invested in a Hottie Potatee franchised business that serves potatoes with all the trimmings. The business needs lots of employees in order to operate effectively. He told you that if he calls the business once each day and tells the employees that he is on his way there, they will be on their best behavior. As he tells it, "It's okay if I really don't make it there, after all, I'm the owner and the business should be able to run without micromanagement." As a recent student of business ethics, you remind Jake that:
Explanation:
It is important that Jake change his stance in relation to his leadership style, as an effective leader is one who can communicate with his employees in a direct and ethical way, providing essential information for carrying out activities and through his example of conduct and behaviors build a work environment focused on collaboration, employee engagement, motivation, performance, learning, etc.
To achieve satisfactory results, the leader has to base his management and his conduct on integrity, respect and values that serve as an example of the employees' conduct, so that he feels integrated and essential for the organization, increases his job satisfaction and creating so there is a positive environment and focused on development and generating results.
You find the following Treasury bond quotes. To calculate the number of years until maturity, assume that it is currently May 2019 and the bond has a par value of $1,000.
Rate Maturity Mo/Yr Bid Asked Chg Ask Yld
?? May 21 103.5540 103.5418 +.3093 6.119
5.524 May 26 104.5030 104.6487 +.4365 ??
6.193 May 36 ?? ?? +.5483 4.151
Required:
In the above table, find the Treasury bond that matures in May 2036. What is the asked price of this bond in dollars?
Answer:
$1,247.12
Explanation:
For computing the asked price we need to apply the present value formula i.e to be shown in the attachment below
Given that,
Future value = $1,000
Rate of interest = 4.151% ÷ 2 = 2.076%
NPER = 17 years × 2 = 34 years
The 20 years come from May 2019 to May 2036
PMT = $1,000 × 6.193% ÷ 2 = $30.965
The formula is shown below:
= -PV(Rate;NPER;PMT;FV;type)
So, after applying the above formula, the present value or the ask price is $1,247.12
In a period of steadily rising prices (meaning the cost to purchase inventory is increasing over time), what would be the implications of choosing FIFO vs. LIFO
Answer:
So choosing FIFO would yield the highest profit and net income.
Explanation:
When the purchase price is continuously rising the
FIFO assigns the lowest amount to cost of goods sold- yielding the highest gross profit and net income.LIFO assigns the highest amount to the cost of goods sold -yielding the lowest gross profit and net income.So choosing FIFO would yield the highest profit and net income.
FIFO assigns an amount to inventory closely approximating current replacement cost. First in First out charges costs to items old assuming that the earliest units purchased are first units sold.
Which of the following is not a finding or conclusion of the research study by ou and penman that used traditional accounting measure to predict whether a company's income would increase or decrease?
a. The researchers were unable to describe the following year earnings changes correctly in most cases.
b. Markets are not as efficient as efficient-market advocates would like to believe.
c. Better accounting standards might improve the predictive ability of accounting information.
d. Fundamental analysis is still important for investment purposes.
Answer: a. The researchers were unable to describe the following year earnings changes correctly in most cases.
Explanation:
It was long believed and shown by the works of researchers before Jane Ou and Stephen Penman that the price and performance of stock prices can be used to predict the direction that earnings would take. They attributed this to the fact that stock prices have off information about how the company would perform and by extension how much earnings it would make.
Ou and Penman expanded on this research by showing that the information that the stock prices had was already inside the financial statements of the company. As such they were able to describe the earnings changes in the coming period.
Consider each situation and determine whether the person is structurally unemployed, frictionally unemployed, or cyclically unemployed.
a. Julie had to leave her old job when she moved to a new city. She works in customer service and is looking for a new job.
b. Julie graduates from college and is looking for a job as an accountant.
c. Bob loses his job as the economy slips into a recession.
d. Jim got laid off from his job at an auto manufacturer as the company became more automated.
Answer:
The correct answers are:
a - Frictionally unemployed
b - Frictionally unemployed
c - Cyclically unemployed
d - Structurally unemployed
Explanation:
To begin with, the term of "Frictional unemployment" refers to the situation that is caused when a person does not have a job because of the fact that she has recently quit one and is looking for a new one. The name of frictional unemployement refers to the time that the person quits a job and gets a new one.
Secondly, the term of "Cyclical unemployment" refers to the situation that is caused due to the economics situations of the country. Therefore that this type of unemployment is caused because of the bad sales, the bad production and the bad moment that the economy is having. It is refered to the economic cycles.
Finally, the term of "Structural unemployment" refers to the situation that is caused when a person in without a job due to the specialties and necessities that the companies are requiring or looking for. Therefore that this type of unemployment is caused by the lack of education in the workforce.
The correct answers are:
Frictionally unemployedFrictionally unemployed Cyclically unemployed Structurally unemployed.Explain the types of employment mentioned above ?The clinical unemployment refers to the component of the overall unemployment that is an output of the cycles of direct economic upturn and downturns.
Structural unemployment is the involuntary unemployment that is due to the mismatch between the skills that the workers in the economy can offer. Frictional unemployment is a voluntary transmission within the economy.
Find out more information about the unemployed.
brainly.com/question/10546218.
Combs Co. is planning to sell 400 hair dryers and produce 380 hair dryers during March. Combs uses 500 grams of plastic and one-half hour of direct labor to produce one hair dryer. Plastic costs $10 per 100 grams and employees of the company are paid $15 per hour. Manufacturing overhead is applied at a rate of 110% of direct labor costs. Combs Co. has 300 kilos of plastic in beginning inventory and wants to have 200 kilos in ending inventory. How much is the total amount of budgeted direct labor for March?
a. $2,800
b. $5,600
c. $2,660
d. $5,320
Answer:
Budgeted labour cost =$8,550
Explanation:
Labour budgeted is prepared using the production budget data. This is simply because the budgeted labour hour is a function of the budgeted production units.
Budgeted labour hours = Production budget × standard hours per unit
= 380 × 1.5 hours=570
Budgeted labour cost= Budgeted labour hours × Standard labour rate
= 570 hours × $15 =$8550
Budgeted labour cost =$8,550
QUICK ONE!
A truck costing $80,000 has an expected life of 8 years
Required:
c) Prepare a depreciation schedule using the reducing balance method? (assuming the rate is 1.5 times the straight-line rate)
Answer:
Rate is 1.5 times the straight line depreciation rate which is;
= [tex]\frac{80,000}{8}[/tex]
= $10,000 per year
Rate = [tex]\frac{10,000}{80,000}[/tex] * 100%
=12.5%
Reducing balance rate = 12.5% * 1.5
= 18.75%
The Depreciation Schedule would be;
Year Beginning Book Value Depreciation Expense Accumulated Depreciation Book Value
1 $80,000 80,000*18.75% = $15,000 $15,000 $65,000
2 $65,000 65,000 * 18.75% = $12,1875.50 $27,187.50 $52,812.50
3 $52,812.50 52,812.5 *18.75% = $9,902.34 $37,187.84 $42,910.16
4 $42,910.16 42,910.16 * 18.75% = $8,045.66 $45,233.50 $34,766.50
5 $34,766.50 34,766.50 * 0.1875 = 6,518.72 $51,752.22 $28,247.78
6 $28,247.78 28,247.78 * 0.1875= $5,296.45 $57,048.67 $22,951.33
7 $22,951.33 22,951.33 * 0.1875= 4,403.37 $61,452.04 $18,547.96
8 $18,547.96 18,547.96 * 0.1875 = $3,477.74 $80,000 $0
$3,477.74 + 15,070.22= $18,574.96
Depreciation for the last year was not sufficient to take the truck to $0 so the remainder will be depreciated in that year so that it may be completely depreciated.
Using the percentage-of-receivables method for recording bad debt expense, estimated uncollectible accounts are $33600. If the balance of the Allowance for Doubtful Accounts is $7640 debit before adjustment, what is the amount of bad debt expense for that period
Answer:
The amount of bad debt expense for that period is $41240.
Explanation:
As the Allowance for Doubtful Accounts has credit balance because it is a contra account receivable account. This account should have credit balance. As already account has debit balance so this balance needs to be added in the estimated uncollectible accounts for the period to calculate the bad debt expense for the period.
Estimated uncollectible accounts = $33600
Allowance for Doubtful Accounts Balance = $7640 debit
Bad debt expense = $33600 + $7640 = $41240
A company's product sells at $12.30 per unit and has a $5.45 per unit variable cost. The company's total fixed costs are $96,500. The break-even point in units is:
Answer:
Break-even point in units= 14,088 units
Explanation:
Giving the following information:
A company's product sells at $12.30 per unit and has a $5.45 per unit variable cost. The company's total fixed costs are $96,500.
To calculate the break-even point in units, we need to use the following formula:
Break-even point in units= fixed costs/ contribution margin per unit
Break-even point in units= 96,500/ (12.3 - 5.45)
Break-even point in units= 14,088 units
Mountain Lake Corporation's accounting records show the following at year-end December 31, 2014:
Purchase Discounts $7,230 Beginning Inventory $32,660
Freight-In 8,730 Ending Inventory 29,170
Freight-Out 12,260 Purchase Returns and Allowances 4,190
Purchases 164,250
Assuming that Mountain Lake Corporation uses the periodic system, compute the cost of goods purchased and cost of goods sold.
1. Cost of goods purchased$=?
2. Cost of goods sold$=?
Answer:
Cost of goods purchased= $161,560
Cost of goods sold= $165,050
Explanation:
1. Cost of goods purchased (net) = Purchases - Purchase discount - purchase returns and allowances + Freight in
= $164,250 - $7,230 - $4,190 + $8,730
=$161,560
2. Cost of goods sold = Beginning inventory + Net purchase - Ending inventory
= $32,660 + $161,560 - $29,170
= $165,050
You will be paying $10,200 a year in tuition expenses at the end of the next two years. Bonds currently yield 9%. a. What is the present value and duration of your obligation
Answer:
Present value of obligation is $17,942.94
Duration 1.4785 years
Explanation:
Present value of obligation can be calculate by using following formula
PV = Tuition payment x ( 1 + yield rate )^-n
PV of First year payment = $10,200 x ( 1 + 9% )^-1 = 9,357.80
PV of Second year payment = $10,200 x ( 1 + 9% )^-2 = 8,585.14
PV of Obligation = PV of First year payment + PV of Second year payment
PV of Obligation = 9,357.80 + $8,585.14 = $17,942.94
Duration
Time in years PV of Payments Weight Duration (Time x Weight)
1 $9,357.80 0.5215 0.5215 x 1 = 0.5215
2 $8,585.14 0.4785 0.4785 x 2 = 0.9569
Total $17,942.94 1.0000 1.4785
On January 1, 2013, the balance in Tabor Co.'s Allowance for Bad Debts account was $13,501. During the first 11 months of the year, bad debts expense of $21,413 was recognized. The balance in the Allowance for Bad Debts account at November 30, 2013, was $9,896. Required: (a) What was the total of accounts written off during the first 11 months? (Hint: Make a T-account for the Allowance for Bad Debts account.) (b) As the result of a comprehensive analysis, it is determined that the December 31, 2013, balance of the Allowance for Bad Debts account should be $9,276. Show the adjustment required in the journal entry format.
Answer:Total of accounts written off=$25, 018, part b is in the explanation column
Explanation:
Total of accounts (Bad debt) written off=Opening Balance in bad debt allowance account+
bad debt expense recognized during the period −
Closing balance in bad debt allowance account
=$13,501+$21,413−$9,896
=$25, 018
T---account
Allowance for bad debts
$13,501 Balance from Jan 1st
$21,413 Bad debts expense
Bad debts written off $25, 018
$9,896 Balance on November 30
b)Adjusted journal entry for change in amount of allowance for bad debt account
December 31st 2013 Account Debit Credit
Allowance for bad debts $620
Bad debts expense $620
calculation
The balance in allowance for bad debt account as on November 30 is $9 896 , when it was supposed to be $9,276. Therefore the bad debt expense is overstated by
$9,896- $9, 276 = $620
Problem 20: In the year 2001, product A was sold. for $300 per
unit making a gross profit of 20% on sales. The total
production cost was made up of 25% of direct material, 40%
of direct labor, and 35% of factory overhead. Due to general
rise in prices in 2002, the selling price of the product
increased by 15%. The cost of production has also increased
resulting in increase of Material, Labor, and factory overhead
costs by 10%, 15%, and 12% respectively. What will be the
gross profit per unit in 2002?
Answer:
74.52
Explanation:
price= 300
lets assume there were 100 units
old new
sales 30000 34500
Gross profit 6000 7452
Prod cost 24000 27048
DM 6000 6600
DL 9600 11040
OH 8400 9408
Total 24000 27048
new price= 300x115% = 345
so gross profit per unit will be = 7452/100 = 74.52
Bruin, Inc., has identified the following two mutually exclusive projects: Year Cash Flow (A) Cash Flow (B) 0 -37,500 -37,500 1 17,300 5,700 2 16,200 12,900 3 13,800 16,300 4 7,600 27,500 a) What is the IRR for each of these projects
Answer:
IRR for project A = 19.71%
IRR for project B= 18.76%
Explanation:
Internal rate of return is the discount rate that equates the after tax cash flows from an investment to the amount invested
IRR can be calcuated using a finanical calcuator
for project A :
Cash flow in year 0 = -37,500
Cash flow in year 1 = 17,300
Cash flow in year 2 = 16,200
Cash flow in year 3 = 13,800
Cash flow in year 4 = 7,600
IRR = 19.71%
for project B :
Cash flow in year 0 = -37,500
Cash flow in year 1 = 5,700
Cash flow in year 2 = 12,900
Cash flow in year 3 = 16,300
Cash flow in year 4 = 27,500
IRR = 18.76%
To find the IRR using a financial calculator:
1. Input the cash flow values by pressing the CF button. After inputting the value, press enter and the arrow facing a downward direction.
2. After inputting all the cash flows, press the IRR button and then press the compute button.
the differences between career and non career
A stock just paid a dividend of $5.37 and is expected to maintain a constant dividend growth rate of 4.6 percent indefinitely. If the current stock price is $77, what is the required return on the stock
Answer:
The required return on the stock is 11.89%.
Explanation:
To calculate this, the Gordon growth model (GGM) formula is used as follows:
P = d1 / (r – g) ……………………………………… (1)
Where;
P = current share price = $77
d1 = next dividend = Recent dividend * (1 + g) = $5.37 * (1 + 0.046) = $5.61702
r = required return = ?
g = dividend constant growth forever = 4.6%, or 0.046
Substituting the values into equation 1) and solve for r, we have:
77 = 5.61702 / (r - 0.046)
77(r - 0.046) = 5.61702
77r - 3.542 = 5.61702
77r = 5.61702 + 3.542
r = 9.15902 / 77
r = 0.1189, or 11.89%
Therefore, the required return on the stock is 11.89%.
When or how does a contract become a legal document and is binding on all parties involved?
Wallace and Simpson formed a partnership with Wallace contributing $96,000 and Simpson contributing $76,000. Their partnership agreement calls for the income (loss) division to be based on the ratio of capital investments. The partnership had income of $215,000 for its first year of operation. When the Income Summary is closed, the journal entry to allocate partner income is: (Do not round intermediate calculations.)
Answer:
Dr Income summary 215,000
Cr Wallace, capital 120,000
Cr Simpson, capital 95,000
Explanation:
When a business has made a profit, the income summary account must have a debit balance before closing it. That way, when you close it, you credit the income summary account and debit the retained earnings or capital accounts in this case.
Wallace = (96 / 172) x $215,000 = $120,000
Simpson = (76 / 172) x $215,000 = $95,000
Guthrie Enterprises needs someone to supply it with 210,000 cartons of machine screws per year to support its manufacturing needs over the next five years, and you’ve decided to bid on the contract. It will cost $2,650,000 to install the equipment necessary to start production; you’ll depreciate this cost straight-line to zero over the project’s life. You estimate that in five years this equipment can be salvaged for $220,000. Your fixed production costs will be $705,000 per year, and your variable production costs should be $9.51 per carton. You also need an initial investment in net working capital of $375,000. If your tax rate is 22 percent and you require a 10 percent return on your investment, what bid price per carton should you submit?
Answer:
$6.9807 per carton
Explanation:
210,000 cartons of machine screws
equipment cost $2,650,000
depreciation per year = ($2,650,000 - $220,000) / 5 = $486,000
fixed manufacturing costs $705,000 per year
variable costs per carton = $9.51 x 210,000 = $1,997,100
initial investment in net working capital $375,000
tax rate 22%
discount rate 10%
price per carton?
initial investment = -$3,025,000
CF₁ = [(R - $705,000 - $486,000) x 0.78] + $486,000 = 0.78R - $442,980
CF₂ = [(R - $705,000 - $486,000) x 0.78] + $486,000 = 0.78R - $442,980
CF₃ = [(R - $705,000 - $486,000) x 0.78] + $486,000 = 0.78R - $442,980
CF₄ = [(R - $705,000 - $486,000) x 0.78] + $486,000 = 0.78R - $442,980
CF₅ = [(R - $705,000 - $486,000) x 0.78] + $486,000 + $220,000 + $375,000 = 0.78R + $152,020
$3,025,000 = (0.78R - $442,980) / 1.1 + (0.78R - $442,980) / 1.1² + (0.78R - $442,980) / 1.1³ + (0.78R - $442,980) / 1.1⁴ + (0.78R + $152,020) / 1.1⁵ = 0.709R - $402,709 + 0.645R - $366,099 + 0.586R - $332,817 + 0.533R - $302,561 + 0.484R + $94,392
$3,025,000 = 2.957R - $1,309,794
$4,334,794 = 2.957R
R = $4,334,794 / 2.957 = $1,465,943.19
total revenue = $1,465,943.19
revenue per carton = $1,465,943.19 / 210,000 = $6.98
In choosing between the range of alternative investments typically available to U.S. households, which of the following will play a role in influencing their selection of a particular investment type?
a. the expected rate of return, risk and liquidity of each kind of investment.
b. the interest rate and the expected rate of return.
c. the form of dividends, angel investor, future expectations.
Answer:
b. the interest rate and the expected rate of return.
Explanation:
For choosing the type of particular investment it is necessary to check the interest rate and the expected rate of return as every investor wants that there is a less interest rate, less or moderate risk but high rate of return and according to this they made the selection
Therefore the option b is correct
Bermuda Cruises issues only common stock and coupon bonds. The firm has a debt–equity ratio of .75. The cost of equity is 11.6 percent and the pretax cost of debt is 6.7 percent. What is the capital structure weight of the firm's equity if the firm's tax rate is 40 percent?
Answer:
the capital structure weight of the firm's equity will be 57.14 %.
Explanation:
Weighted Average Cost of Capital is the return that is required by the providers of long term sources of finance.
A debt–equity ratio of 0.75 means:
Debt : Equity = 0.75 : 1
The Total Ratio will be = 0.75 + 1.00
= 1.75
Therefore, the capital structure weight of the firm's equity will be :
Equity Weight = Equity Ratio ÷ Total Ratio
= 1.00 ÷ 1.75
= 0.5714 or 57.14 %
when the market demand curve crosses the long-run average total cost curve where average total costs are declining, the firm is called
Answer: Natural monopoly
Explanation:
A natural monopoly is a form of monopoly that comee into being due to huge start-up costs and also economies of scale. A firm that has a natural monopoly may be the only producer of a particular good or service.
A natural monopoly occurs when the long-run average total cost curve is crossed by the markwt demand curve when the average total costs are still diminishing.
The part of an industry's value chain that is most important to a company and the point where its greatest expertise and capabilities lie is called the company's R&D intensity. center of gravity. economy of scope. functional crossroads. dynamic equilibrium.
Answer:
center of gravity.
Explanation:
The part of an industry's value chain that is most important to a company and the point where its greatest expertise and capabilities lie is called the company's center of gravity.
Generally, the center of gravity of a company is usually the point at which it started business. The center of gravity of a company defines its strengths, success, achievement and dominant operations.
For any successful business, there is always a center of gravity. This is the point or stage where all of the strategic decisions, greatest expertise, risks management and capabilities lie.
Hence, should there be an error, disagreement or disarray at the center of gravity, then the company is headed for losses and bankruptcy.
Carl is a self-employed real estate agent. For the current year, his self-employment net earnings (revenues minus expenses) are $80,000. He is also employed as an accountant with a gross salary of $70,000 for the year. Assume that the appropriate social security income ceiling for the year is $130,000 and that the self-employed FICA rates are 12.4% for social security and 2.9% for Medicare. What is Carl s self-employment tax liability for the year
Answer:
$12,240
Explanation:
Social security Tax = $80,000 x 12.4%
Social security Tax = $9,920
Medicare Tax = $80,0000 x 2.9%
Medicare Tax = $2,320
Total tax = $9,920 + $2,320
Total tax = $12,240
The first budget customarily prepared as part of an entity's master budget is the Group of answer choices sales budget cash budget direct materials purchases production budget
Answer:
Sales budget
Explanation:
A budget is an amount that is planned and set aside to be used for a particular purpose. It helps a business entity plan and efficiently use its resources.
As a business the first budget that is usually prepared is the sales budget. This is the primary purpose of the entity, to sell and make profit.
As profit is generated from sales other activities can easily be budgeted for.
Master budget is collection of all lower budgets of a business
Answer:
sales budget
Explanation:
The master budget is a document in which a company shows all the budgets for each department to have the whole picture of the business finances. Usually, it begins with the sales budget that is created using the sale forecast that is adjusted based on additional information and the manager's judgement. This is the first budget because it affects the other budgets as the level of production would depend on the expected sales. According to this, the answer is that the first budget customarily prepared as part of an entity's master budget is the sales budget.