Production budget is a forecast of production for the budget period. It is PREPARED from two angles: In terms of quantity and in terms of money.

Following budgets are prepared under the production budget:

• Material Budget to ESTIMATE the material cost
• DIRECT Labour Cost Budget to estimate the labour cost which are REQUIRED to product the quantity as specified in the production budget.
• Overhead Budget to estimate production overheads.

Production budget is prepared after taking various budgets into consideration. For a proper estimation of various costs associated with the production process makes it important to prepare production budget for the period in which production will take PLACE.

Production budget is a forecast of production for the budget period. It is prepared from two angles: In terms of quantity and in terms of money.

Following budgets are prepared under the production budget:

Production budget is prepared after taking various budgets into consideration. For a proper estimation of various costs associated with the production process makes it important to prepare production budget for the period in which production will take place.