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Before approaching this assignment, be sure that you have watched the following video.
Budgetary Planning featuring Babycakes *FULL VIDEO*. (2016). YouTube.
Babycakes, a specialty bakery, is the company that will be considered for all parts of your budget
planning and control report. For this assignment, you will develop a three to four (3 – 4) page paper in
which you address the following.
Briefly discuss the ways a realistic budget will benefit the owner of Babycakes versus having no budget at
all. Be sure to use Babycakes as the company and any specific product details in your explanation.
Prepare a sales budget for the LA Babycakes store for the 4th quarter of 2016. Present the number of
units, sales price, and total sales for each month; include October, November, and December, and a total
for the quarter. Use one-half of the Valentine’s Day sales as the basis for a usual day in the new quarter.
Use 30 days for each month. Calculate the total sales for each month for October, November, and
December.
Create three (3) new products, one (1) for each of the three (3) holiday seasons in the 4th quarter.
Estimate the sales units, sales price, and total sales for each month. Describe the assumptions used to
make these estimates. Include an overview of the budget in the report, presenting the actual budget as
an appendix with all data and calculations. Add these amounts to your sales budget.
The owner of Babycakes is interested in preparing a flexible budget rather than the static budget she
currently uses. She does not understand why, when sales increase, her static budget often shows an
unfavorable variance. Explain how a flexible budget will overcome this problem. Use the details of your
newly prepared budget for the 4th quarter of 2016 to address her concern.
Imagine that Babycakes is facing a financial challenge that is causing the actual amount of money that it
spends to become significantly more than its budgeted amount. Include a discussion of your own unique
cause of the overspending. Explain the corrective actions needed to address these challenges.
Integrate relevant information from at least three (3) quality academic resources in this assignment.