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fomenos
3 years ago
13

LO 7.2What operating budget exists for manufacturing but not for a retail company?

Business
1 answer:
belka [17]3 years ago
8 0

Answer:

Production Budget

Explanation:

Production Budget is usually substituted <em>with</em> Purchasing budget for a retail company.

The operating budget usually consist of the:

  • sales budget,
  • production budget,
  • manufacturing overhead budget.

However, for a retail company that usually do not produce their products or inventory but purchase them, the Production Budget is usually substituted <em>with</em> Purchasing budget or merchandise inventory to be purchased; meaning since they do not have raw materials they<em> substitute </em>the number of units to be purchased, to the number of units to be produced.

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These types of contracts are called Sales contracts which is an agreement between the buyer and seller. For the amount of money involved, a written contract provides security and peace to the mind of all those involved in the contract, hence why deals above $500 must be written to be enforceable.

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