Projected Profit and Loss Statement

The action plans should allow the manager to assemble a supporting budget that is actually a projected profit and loss statement. On the revenue side, it shows forecasted sales, both in units and Rands, at an average price. The expense side shows production costs, physical distribution and marketing cost, and these can be broken down into further categories. The difference is projected profit.

Once approved, the budget becomes the basis for developing material procurement plans and schedules, production schedules, recruitment plans and marketing operations.