I. An Overview of Budgeting - Jacksonville State University
Chapter 10 Budgetary Planning and Control Presentation Outline I. II. An Overview of Budgeting The Master Budget and Selected Budget Formats I. An Overview of Budgeting A. The Stages of Budgeting
B. Developing the Budget A. The Stages of Budgeting 1. Planning 2. Control 1. Planning The budget process forces managers to consider carefully their goals and objectives and to specify means of achieving them.
2. Control Budgets provide a means of evaluating performance. Potential causes of significant deviations from budgets include: Budget was poorly conceived. Conditions have changed since the budget was prepared. Managers have done a particularly good or poor job. B. Developing the Budget
1. The Budget Committee 2. The Budget Time Period 3. Zero Base Budgeting 1. The Budget Committee Various budgets are approved by a budget committee that is composed of senior managers such as the president, CFO, VP of operations, and the controller. Budgets may be developed with either
a top-down or bottom-up approach. 2. The Budget Time Period Budgets may cover a variety of time periods including a month, quarter, year, or even longer. Generally, longer budget periods provide less detail. 3. Zero Base Budgeting Budgets are often adjusted up
or down on the basis of a previous period adjusted for current conditions. Zero base budgeting requires that all budget amounts be currently justified even if they were supported in prior budgets. Due to the cost of the process, this zero base budgeting is often not used in business. II. The Master Budget and Budget Formats
A. A Formal Summary of Company Plans B. Selected Budget Formats The master budget coordinates the organizations activities. A. A Formal Summary of Company Plans It sets specific targets for sales, production, selling and admin., and capital
acquisitions. It culminates a budgeted income statement, balance sheet, and cash receipt and disbursement summary. III. Selected Budget Formats A. Sales Budget B. Production Budget C. Direct Materials Budget D. Direct Labor Budget E. Overhead Budget
F. Cash Receipts and Disbursements Budget A. Sales Budget Projected sales x Selling price per unit = Budgeted sales revenue B. Production Budget Budgeted sales in units + Desired ending inventory of finished goods = Total needs - Beginning inventory of finished goods
= Units to be produced C. Direct Materials Budget Units to be produced x Cost of parts per unit = Cost of parts needed for production + Desired ending inventory of parts = Total needed - Beginning inventory of parts = Cost of purchases D. Direct Labor Budget Direct labor hours per unit
x Labor rate per hour = Direct labor cost per unit x Units to be produced = Total direct labor cost E. Overhead Budget Units to be produced x Variable costs per unit = Total variable overhead + Budgeted fixed overhead = Total budgeted overhead - Noncash expenses = Cash disbursements for overhead
F. Cash Receipts and Disbursements Budget Cash receipts - Cash disbursements = Excess (deficiency) of cash available over disbursements + Beginning cash balance = Ending cash balance IV. Static v. Flexible Budget A. Static Budget B. Static Budget Illustration C. Flexible Budget D. Flexible Budget Illustration
A. Static Budget Why are we so off from budget? A budget designed for only one level of activity. Differences from the budget can be misleading when an organization actually operates at a different
level of activity. B. Static Budget Illustration Standard cost per unit Actual 8,000 Units produced and sold Variable Overhead Costs: Maintenance $
Indirect materials Utilities Fixed Overhead Costs: Depreciation Supervision Insurance Total fixed overhead Total overhead costs 0.60 1.40 1.00
1,000 F 1,000 F 5,000 F $ F F F F C. Flexible Budget A budget designed to cover a range of
activity. Can be used to compare actual costs incurred to budgeted costs around that level of activity. D. Flexible Budget Illustration Standard cost per unit Units produced and sold Variable Overhead Costs: Maintenance $ Indirect materials
Utilities $ Fixed Overhead Costs: Depreciation Supervision Insurance Total fixed overhead Total overhead costs Units 10,000 5,000
10,000 100,000 $ 145,000 Summary Planning and control stages of budget Budget committees, time periods, zero based budgeting Formal plan culminating in projected financial statements Budget formats Static and flexible budgets
The Black Cat. Edgar Allan Poe. ... my general temperament and character —through the instrumentality of the Fiend Intemperance —had (I blush to confess it) experienced a radical alteration for the worse." "One morning, in cool blood, I slipped a...
To follow ethical standards Ethics- guiding set of moral principles *Professional who follow the Code of Ethical Conduct ensure that programs for young children are based on the most recent knowledge of child development and early childhood education *may involve...
The IR-CAP process is designed to elevate agency awareness of IR compliance issues and to demonstrate to DIR that you are making progress toward correcting them. While . full compliance remains a challenge for some agencies, DIR stands ready to...
PANGANGALULUWA IN THE PHILIPPINES 1A GROUP3: Bea Bondoc, Lala Cortes, Cassie Lim, Bea Manzo, Baba Mathay, Bettina Songco HISTORY In older days the pangangaluluwa's purpose was to represent the souls of the dead circulating amongst homes in search of prayers...
My study is concerned with the zero hour forecast. Essentially, what the NWM thinks is happening right now. At this point in the NWM, physical data is being forced into the model. Defined as a "snapshot of current hydrologic conditions"...
The environment in Cochise County is more supportive of healthy eating and active living through increased community buy-in and infrastructure changes . The Healthy Community Committees become self-sustaining, able to maintain consistent action through ongoing recruitment of volunteers and ability...
Dissection Cuts. 3 main cuts total-1. Cut from abdomen up to neck-2. Cut across front legs-3. Cut across rear legs *Have to perform cuts twice. Once to cut through skin, then again to cut through muscle*
Ready to download the document? Go ahead and hit continue!