...Kelsey Budget Report September 24, 2012 Kelsey Budget Report Kelsey is located in the Northwest valley and has a population of over 600,000 residents. Kelsey’s budget plays an important role in the City of Kelsey Government. Kelsey has an extensive budget and financial report because of the size of the city and the number of residents that live in the city. Recently the mayor of Kelsey has put in a request to Kerry, the budget director. The request asks that the budget director needs to revamp the City of Kelsey budget for the upcoming year. Because of an increase in population in the City of Kelsey, statistics show an increase in crime in the City of Kelsey that is above the norm. This brings about a need for more police officers (University of Phoenix, 2011). Another issue is the recent reduction in federal pass-through funds, which will have a negative impact the budget for the City of Kelsey. At the federal level, a budget reform has put pressure on the City of Kelsey and other policing agencies to implement the use of federal funds within the allotted period. The mayor of Kelsey does not believe that state aid is an option for the City of Kelsey to make up the budget deficit, and increasing taxes does not appear to be an option because the state and local government does not want to increase taxes as this time. A final issue is a local club; the Sierra Club does not want more police officers and instead wants the City of Kelsey and the state to build more...
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...Week 6 Problem Flexible Budget and Variances NOTE: It is expected that this problem will be completed using an Excel spreadsheet using formulas. Please see the Excel Tutorial that is available under the course home tab. The Grant Company had developed a Static Budget for 2005 for one of its major departments. By the end of the year, the owner was quite pleased since he knew that sales were running above the projections. He was confident that 2005 was going to be the best year ever for this important part of the company! When the 2005 financial statements were completed, it was discovered that the gross profit for the department was lower than had been originally projected. But sales were up! What happened? You have been hired to determine why 2005 was not a "banner year"! You have been supplied with the original Static Budget and the actual results as follows: Static Budget Actual 2005 Figures Units Sold 10,000 11,000 Revenue $1,000,000 $1,078,000 Material 300,000 350,900 Labor 250,000 247,500 Variable Overhead 150,000 194,700 Fixed Overhead 200,000 195,000 Gross Profit $100,000 $89,900 You are also provided with the following information regarding standards and actual results: Standard Actual Selling price $100 per unit $98 per unit Cost of materials $15 per foot $14.50 per foot Materials per unit 2 feet per unit 2.2 feet per unit Labor rate $25 per hour $30 per hour Labor usage 1 hour per unit 0.75 hours per unit Variable overhead rate $30 per...
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...Budget Variance Every hospital faces many challenges, but one of the most difficult challenges is knowing how to manage expenses. When a hospital is planning their budget not only do they have to plan a budget that is beneficial for their staff but also high level care for their patients. With so much in society changing such as technology, increase health care cost, and government restrictions it makes planning the budget very challenging. In order to analyze how expenses are being spent compared to the budget that is allotted for them, budget variances have to be made (accountingtools.com, 2013). These variances have to be extremely well detailed in order to make an accurate budget for the following year. Things that should be taken into consideration when doing a budget variance are variance reports, interpreting the results of variance reports and analyzing these reports based on actual performance, and developing a way to better the budget based on these results. The purpose of this paper is to fully analyze all factors that should be considered for a budget variance for a hospital. The very first step for a budget variance is to develop a variance report (accountingtool.com, 2013). There are various factors that should be analyzed to produce a proper variance report such as how many beds are available, how many patients are seen daily, how much staff is available or working in a specific day, how many supplies will be used, and how much utilities such as electricity...
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...Kenya Ratcliff American Intercontinental University FINA425 – Budgeting January 24, 2016 Abstract This is a research paper about financial budgets. This research paper talks about a management director would establish policies and system for a business and/or organization. This research paper will help to explain the different style of budgets, budget cycles and the guidelines rules for set up a financial budget for a business and/or organization. Unit 3 Individual Project Introduction This is a report from the management director to establish policies and systems for the new business, I Can Business Incorporated (ICBI). This report will be delivered to the board of directors of ICBI. This report will describe what a financial reporting system is and explain how management for ICBI should use an activity based budget instead of an operating budget. This report also gives examples of budget guidelines for ICBI. Describe the meaning and the components of a financial reporting system Financial reporting is the process of compiling statements that shows a glimpse of an organization’s financial “health” or status to management, investors and the government. There are four basic reports that are included in a financial report. There is a balance sheet, an income statement or sometimes called the profit & loss statement, a cash flow statement and a statement of shareholder’s equity. The balance sheet gives a detailed picture of the financial condition of a business at...
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...Budget Management Analysis John Thorpe HCS/571 April 13, 2014 Professor: Amy Reed Budget Management and Variance Analysis Healthcare organizations are faced with severe financial pressures resulting in extreme budget cuts. Consequently, nurse managers and financial managers are tasked with the responsibility of doing more with less while maintaining the high quality of care offered to its consumers. To accomplish the aforementioned tasks, managers use budgetary tools to help them focus on controlling cost while running an efficient operation. Budgeting gives managers the tools necessary to ensure the availability of required resources to meet the organization’s goals and objectives, communicate strategies and monitor results (Cleverly, Song & Cleverly, 2007). Finkler, Kovner & Jones (2007) offer that budgeting should be used to make the organization become more effective and efficient. It is not a tool for maintaining the status quo. Organizations use different approaches to introducing the budgetary process. Some organizations take the current year's budget update it for inflation and projected revenue growth. Others take a clean slate approach; compel managers to justify their expenses and staffing needs on an annual basis. Still other organizations forecast revenue and profit and assign expense rates to departments. However, the most effective budget is one that reflects the true financial position of the organization, provides flexibility and monitored...
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...preparation of budgets for Glentruan Furniture Ltd. 13 Budget 13 Purpose and nature of budget 15 Purpose 15 Nature 15 3.2 Select appropriate budgeting methods for new product line and its need. 16 Incremental budget 16 Zero based budget 16 Different between zero based budgeting and incremental budget 16 Fixed budget 17 Flexible budget 17 Different between fixed and flexible budget 17 Functional budget 18 Sales budget 18 Production budget 18 Direct material usage budget 18 Direct material purchase budget 18 Direct labor budget 18 Factory overhead budget 18 Selling and administration budget 18 Cash budget 19 Master budget 19 3.3 Prepare budgets according to the chosen budgeting methods based on the given information in the scenario. 20 Sales budget 20 Production budget 22 Direct material usage budget 23 Direct material purchase budget 26 Direct labor budget 28 Factory overhead budget 30 Selling and administration budget 34 Departmental budget 35 3.4 Also prepare a cash budget. 38 Cash budget 38 Master budget 42 Budgeted profit and loss 42 Budgeted balance sheet 43 Final review 46 Budget committee 47 Working capital 47 Liquidity ratio 47 ROCE 47 4.1 Calculate variances, identify possible causes and recommend corrective action. 48 4.2 Prepare and operating statement reconciling budgeted and actual results. 55 Operating Statement 55 Profit and loss statement 56 4.3 Write a memo and report findings to...
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...intricate business. Health care executives now have to find ways to transform a broken and out of date health cares system by focusing on reducing pointless surgeries and diagnostic test and removing disproportionate health care costs. When the annual budget presents itself and shows that salaries are steadily increasing with supplies decreasing several factors have to be considered when presenting the variance analysis report. Factors that should be considered are the number of staffing, patient bed occupancy, specialist care and supplies. In order to control cost the executive must be able to recognize the problem and its cause and have a solution in place to correct it. Evaluating the current costs against the previous costs of the hospital should suggest to executives which factors have contributed to the change. (Cleverley, Cleverley, Song 2011). In this situation it is the salaries increasing and supplies decreasing. These two factors have to be heavily investigated prior to the analysis report. The first factor to consider will be the increase in salaries that were more than what were budgeted for. The most important and largest asset of the hospital are the people that are employed. In regards to the variance report the first consideration to the employment would be to consider those that are employed under a contract. These costs cannot be controlled, however renegotiating the contract can reduce the overall costs of these salaries. Implementing a plan of not...
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...business builder 5 how to prepare a cash budget zions business resource center zions business resource center 2 how to prepare a cash budget At its most basic level, a budget is a plan for owners and managers to achieve their goals for the company during a specific time period. In this business builder you will learn the fundamental concepts of cash budgets and how to evaluate your budget on a month-to-month basis. What You Should Know Before Getting Started • The Purpose of a Cash Budget • Why Prepare a Cash Budget? 3 3 4 How to Create a Cash Budget • Time Period • Desired Cash Position • Estimated Sales and Expenses • Cash Flow Budget Worksheet 4 6 6 6 9 How to Analyze a Cash Budget Conclusion Checklist Resources 10 11 11 12 how to prepare a cash budget 3 what to expect This Business Builder will introduce you to the fundamental concepts of cash budgets and outline the steps necessary for preparing a cash budget for your business. It will also show you how to evaluate your budget on a month-to-month basis. This Business Builder assumes that an income statement and a balance sheet have been prepared for your business. Information from these financial statements are an integral part of creating a budget. Without that information, this Business Builder may not be as helpful as it could be. what you should know before getting started The Purpose of a Cash Budget At its most basic level, a budget is a plan. It is a plan for owners and...
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...Manage budgets and financial plans Assessment activity 1 1. Accurate records management is the first important task in the process of sound financial management or any small business operator. Accurate and regular financial information allows you to monitor the success or failure of a business and provides them with information to evaluate the consequences of their financial decisions. To be successful it is essential that you know the precise financial condition of your business. Accurate and regular financial information allows you to monitor the success or failure of your business and provides you with information to evaluate the consequences of your financial decisions. Regularly monitoring your business activities will help you operate more efficiently control your cash flow and increase your profitability. Solid information about your business depends completely accurate and timely record keeping practices. Accurate financial records will allow you to •identify your income and expenses to create a profit and loss statement •identify your business assets and liabilities to create a balance sheet •identify the timing of income and expenses to create a cash flow forecast •compare your business operations with industry benchmarks * prepare accurate business activity statements and tax returns so you don’t over or underpay your taxes 3. * identify the data that needs to be collected * identify the appropriate source of data * ensure currency, reliability...
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...This report is made possible through the help and support from everyone, including: parents, teachers, family, friends, and the Almighty Allah. We would like to take this opportunity to express our profound gratitude and deep regard to Ashraful Arefin for the chance to do this project. We would also like to thank him for his exemplary guidance, patience, motivation, and immense knowledge. Working under him was an extremely knowledgeable experience for us. We would also like to thank our group mates for their support and hard work throughout his project. For the preparation and the completion of the report, we have chosen a tea stall that we will base our report on. The reason behind choosing a tea stall is that it includes most of the information needed to prepare any kinds of budget starting from sales budget to the budgeted income statement and balance sheet. Every tea stall uses raw materials for production, incurs labor costs, variable and fixed manufacturing costs and selling and administrative expenses. This is why we found tea stalls the most reliable stall to prepare this report on. The tea stall we have chosen is known as “Mamun er Malai Chaa” which is located in Shantinagar bazar. Mr.Mamun, owner of the tea stall, started this stall about two years back in Shantinagar with the idea of serving people with a new taste of tea by selling Malai chaa rather than just normal tea. Within a short time, many people liked his tea and service and were impressed with the new kind...
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...Vershire Company & Aluminum Industry Industry of Aluminum Aluminum. Less spillage or breakage, ease of storage at home or when people travel, maintenance of soft drink carbonation, ease of lithograph and ease of recycling, aluminum production is one of the modern era’s great economic stories. The world’s primary aluminium industry produces over millions ton of aluminium metal per year. The most important markets for aluminium products are the transport, building and packaging sectors, however aluminium also finds application in electrical and mechanical engineering, office equipment, domestic appliances, lighting, chemistry and pharmaceuticals. The United States aluminum industry is the worlds largest, annually producing about $.1 billion in products and exports. U.S. companies are the largest single producer of primary aluminum. The U.S. industry operates over 00 plants in 5 states , produces more than billion pounds of metal annually and employs over 145,000. Aluminum is one of the few products and industries left in America that truly impacts every community in the country, either through physical plants and facilities, recycling, heavy industry, or consumption of consumer goods. The aluminum industrys performance is noteworthy, particularly in light of the proliferation of alternative materials and global competition. Transportation represents the largest market for aluminum in the United States. In 000, transportation accounted for .5 percent of all US...
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...The Vershire Company has to keep tight controls over their plants, budgets, and performance in terms of efficiency and effectiveness, because customers can easily purchase from another manufacturer if cost, quality, and service are not met. The planning strength of the Vershire Company is that a sales budget is formulated at the corporate level and starts with a forecast, which is created and sent to the divisional managers for review. This allows divisional managers to have some input for their budget, which will add to the accuracy. Corporate controllers also visit each plant for additional input before final submission. The company I work also formulates a sales budget; we are actually starting the process in October. We look at our historical sales data, our current sales, and our sales targets for the coming year. The sales budget leads to the development of the other budgets, manufacturing, production, purchasing, inventories, sales and other expenses. Our budgets are usually determined by end of November, no later than mid December for the New Year. All departments have input and are responsible for their budgets. Our forecasting and planning efforts are examined on a monthly basis throughout the year as well as daily inputs from the sales quotation department through their quote follow-up efforts. This allows us to keep tighter controls on inventories to keep us within the set budget as well as keep reasonable lead times for the different product lines. The weakness...
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...earlier. As they were walking, Tom Emory spoke. “Boy, I hate those meetings! I never know whether my department’s accounting reports will show or bad performance. I am beginning to expect the worst. If the accountants said I saved the company a dollar, I’m called Sir, but if I spend even a little too much- boy do I get in trouble. I don’t know if I can hold on until I retire.” Tom had just been given the worst review he had ever received in his long career with Ferguson & Son. He was the most respected of the experienced machinists in the company. He had been with Ferguson & Son for many years and was promoted to supervisor of the machine shop when the company expanded and moved to its present location. The president (Robert Ferguson, Sr.) had often stated that the company’s success was due to the high quality of the work of the machinists like Tom. As a supervisor, Tom stressed the importance of craftsmanship and told his workers that he wanted no sloppy work coming from his department. When Robert Ferguson, Jr. became the plant manager, he directed that monthly performance comparisons be made between actual and budgeted costs for each department. The departmental budgets were intended to encourage the supervisor’s to reduce inefficiencies and to seek cost reduction opportunities. The company controller was instructed to have his staff “tighten” the budget slightly whenever a...
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...component in management short and long term planning.". A budget is a financial plan and a list of all planned expenses and revenues. It is a plan for saving, borrowing and spending. It means budget is very particular plan for a company so that a company can actually know about the financial problem. In business, budgets help you determine how much money you have and how you will use it, and help you decide whether you have enough money to achieve your financial goals. As part of a business plan, a budget can help convince a loan officer that you know your business and have anticipated its needs. Budget is not like target. Target can leading a company to know what they actually needs to do. But budget can help a company to do it right. It can help a company on financial and strategy. A company's budget is a bit more involved. Most companies will start with a master, or static, budget. A static budget is a budget with numbers based on planned outputs and inputs for each of the firm's divisions. It's the first part of budgeting, which determines how much a company has and how much it will spend. These are projected amounts and the company expects to stay within these limits. To figure out the numbers, mangers make use of economic forecasting methods to determine a realistic static budget. In order to make the most effective use of your budgets, you will want to establish reporting devices. These will include periodic reports and reviews on both efforts and accomplishments. It...
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...Assessment criteria 1.4 6 Assessment criteria 1.4 7 Section 2 8 Assessment criteria 2.1 8 Assessment criteria 2.2 8 Assessment criteria 2.3 10 Section 3 11 Assessment criteria 3.1 11 Assessment criteria 3.2 13 Assessment criteria 3.4 15 Zero-based budgeting 16 Top-down budgeting 16 Bottom-up budgeting 16 Activity-Based Budgeting 16 Section 4 18 Assessment criteria 4.1 18 Assessment criteria 4.2 21 Conclusion 22 Bibliography 23 Introduction Financial management is the efficient as well as effective management of the funds in a motive of accomplishing the goals and the objectives an organization. It comprises of how to rise capital and how to allocate for instance through budgeting. This does not only cater for the long term budget but also the allocation of funds in the short term. In our discussion we are going to focus on various issues such the various methods used in costing, the budgeting formation and formation process, and the different types of budgeting. The attainment of coordination will also be factored since it is key to the success of a business. Task 1 Assessment criteria 1.1 a. Identify and explain the various ways by which cost can be classified discussion the value of costs classification including any weaknesses in your argument In the world of business there are a range of costing methods are actually used by the enterprises in evaluation and the analyzing the cost of production when contrasted with the value of other substitutes. In executing...
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