Budgeting Process and Predicted Income Statement Analysis of A.P. Eagers Limited

2/3/2019

Accounting 1
Executive Summary
The purpose of the report is to focus on the budget and its process along with the process is
applied to the real-life company. The report requires the selection of the real world, ASX listed
company due to which A.P. Eagers Limited has been selected. The findings of the report include
the detailed analysis of the master budget with the elements which are used for preparing the
budget. Along with this, the major elements which are discussed include cash budget, inventory
and expense, sales and production with the budgeted financial statement. In addition, the top-
down and bottom-up approaches comparison is done with the motive to find the most appropriate
approach for the selected company. The findings show that the bottom-up approach has been
suggested to the company according to the operations. In the end, the predicted income statement
of the ASX Company that is A.P. Eagers Limited is prepared.

Accounting 2
Contents
Introduction......................................................................................................................................3
Background of the company............................................................................................................4
Master budget elements...................................................................................................................4
Sales and production budget........................................................................................................5
Inventory and expense budget.....................................................................................................5
Cash budget.................................................................................................................................6
Budgeted financial statements.....................................................................................................6
Top-down approach and a bottom-up approach..............................................................................6
Top-down budgeting....................................................................................................................7
Bottom-up budgeting...................................................................................................................7
Comparisons of approaches.........................................................................................................8
Suitable approach.......................................................................................................................11
Budgeted Income statement of the company.................................................................................11
Changes in the income statement..............................................................................................12
Conclusion.....................................................................................................................................14
References......................................................................................................................................15

Accounting 3
Introduction
The aim of the report is to throw the light on the budgeted income statement of the ASX
Company who is operating the business operations in the Australian market. The budgeted
income statement of the company reflects the forecasting of the increase in the revenue and
expenses of the company for the future. The report require to prepare the budget for real life
company due to which A.P. Eagers Limited ASX listed company has been selected and the
company is operating their business in the Australian market. The report majorly focuses on the
budget and the approaches which are used by the company while preparing the budgets of the
company. The discussion related to the elements of the master budget will be stated. The major
components of the master budget and the way to prepare it have been discussed. The major
differences in the approaches of budgeting will be explained. A.P. Eagers Limited needs to
implement one of the approaches while preparing the budget. The income statement for 2019
(budgeted) of the A.P. Eagers Limited has been prepared with the help of 2017 income statement
of the company.