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  After reading this chapter, you should be able to:

  LO 1   Understand the role of budgets in overall organization plans.

  LO 2   Understand the importance of people in the budgeting process.

  LO 3   Estimate sales.

  LO 4   Develop production and cost budgets.

  LO 5   Estimate cash flows.

  LO 6   Develop budgeted financial statements.

  LO 7   Explain budgeting in merchandising and service organizations.

  LO 8   Explain why ethical issues arise in budgeting.

  LO 9   Explain how to use sensitivity analysis to budget under uncertainty.