Cash budget and master budget are two types of budgets used in managerial accounting for planning and control purposes.
GET PDF of fully solved assignment MCO-05 or any other by click above. You can order any subject ignou solved assignments pdf, ignou handwritten assignments pdf or ignou Handwritten Assignments hard copy from above link.
Here is an explanation of each:
Cash Budget:
A cash budget is a financial plan that projects the inflows and outflows of cash for a specific period. It helps businesses manage their cash flow effectively by identifying the expected cash receipts and disbursements for a specific period. A cash budget is essential for businesses to ensure they have enough cash to meet their operational and financial obligations. It includes cash receipts from sales, loans, and investments, as well as cash payments for expenses, investments, and debt repayment.
Master Budget:
A master budget is a comprehensive financial plan that includes all the budgets for a specific period. It is a plan that outlines the overall financial goals and objectives of the business, and it includes both operating and financial budgets. The operating budgets include sales, production, and overhead budgets, while the financial budgets include cash, capital expenditure, and financing budgets. A master budget is a tool for businesses to plan and coordinate their activities and to ensure that they are working towards their overall financial goals.
In summary, a cash budget is a financial plan that projects the inflows and outflows of cash for a specific period, while a master budget is a comprehensive financial plan that includes all the budgets for a specific period. Both budgets are essential for businesses to plan and control their financial activities effectively, but they have different focuses and applications.