Budget Expectations

In: Business and Management

Submitted By dminx3502
Words 1568
Pages 7
Variance
[pic]
Variance is the difference between the forecast amount and the actual amount. When the actual amount is lower than the forecast amount, there is a favorable variance. However, when the actual amount is higher than the forecast amount, there is unfavorable balance.. In this case, variance will be the difference between actual expenses and forecast amount. The total forecast expenses in Munroe regional medical center in 2010 were $307,385 and the actual expenses were $310,536. The difference between the actual expenses and forecasted expenses was $3,152.
[pic]
Expense1
Salaries
The forecasted salary expenses were $105,469 and the actual salary expenses were $101,543. The variance was $101,543-$101=105,469= 3926. The salaries cost in the hospital decreased by 3926 as shown by the positive variance. The salary expenses reduced as the organization did not overspend on salaries as the number of employees was lower than they had planned. The managers were responsible as they stayed within the budget (Cleverly, Song & Cleverly, 2011).
[pic]
Expense 2
Employee benefits
The organization forecasted the employee benefits to be $23,613 in 2010. The actual employee benefits in the organization were $22,513. The variance was &22,513-&23,613=$1,100. The employee benefits reduced by $1,100 and hence the company did not overspent. Though the organization provided employee benefits to its employees, managers ensured the benefits offered to employees did not exceed the planned amount and hence work hard to stay within the budget. The employee benefits could have reduced because the organization did not provide benefits to all the workers as some of the workers were not entitled to employee benefits (Cleverly, Song & Cleverly, 2011).
[pic]
Expense 3
Supplies
The hospital forecasted supply expenses in 2010 to be $72,094, but the expenses were $71,901…...

Similar Documents

Budget

...Budget: An estimate of income and expenditure for a set period of time. Budget (from french bougette) generally refers to a list of all planned expenses and revenues. A budget is an important concept in microeconomics, which uses a budget line to illustrate the trade-offs between two or more goods. In other terms, a budget is an organizational plan stated in monetary terms. The budget of a government is a summary or plan of the intended revenues and expenditures of that government. Budget Preparation A full understanding of the budget planning and preparation system is essential, not just to derive expenditure projections but to be able to advise policymakers on the feasibility and desirability of specific budget proposals, from a macroeconomic or microeconomic perspective. It is much easier to control government expenditures at the "upstream" point of budget preparation than later during the execution of the budget. Thus, fiscal economists and general budget advisors need to know: * what is the framework in which budget decisions are made; * who is responsible for planning and preparing the budget; * what are the basic steps; * what are the typical weaknesses in procedures and how can these be overcome; and * how can changes in budget plans be programmed and targeted? Answers to these questions are set out in the subsections below. Budget planning and preparation are (or should be) at the heart of good public expenditure management.......

Words: 12266 - Pages: 50

Budget

...Evaluating a Company’s Budget Procedures Springfield Corporation operates on a calendar-year basis. It begins the annual budgeting process in late August, when the president establishes targets for the total dollar sales and the net income before taxes for the next year. The sales target is given to the Marketing Department, where the marketing manager formulates a sales budget by product line in both units and dollars. From this budget, sales quotas by product line in units and dollars are established for each of the corporation’s sales districts. The marketing manager also estimates the cost of the marketing activities required to support the target sales volume and prepares a tentative marketing expense budget. The executive vice president uses the sales and profit targets, the sales budget by product line, and the tentative marketing expense budget to determine the dollar amount that can be devoted to manufacturing and corporate expenses, and then forwards to the Production Department the product-line sales budget in units and the total dollar amount that can be devoted to manufacturing. The production manager meets with the factory managers to develop a manufacturing plan that will produce the required units when needed within the cost constraints set by the executive vice president. The budgeting process usually comes to a halt at this point because the Production Department does not consider the financial resources allocated to be adequate. When this......

Words: 462 - Pages: 2

Budget

...Budget: An estimate of costs, revenues, and resources over a specified period, reflecting a reading of future financial conditions and goals. One of the most important administrative tools, a budget serves also as a (1) plan of action for achieving quantified objectives, (2) standard for measuring performance, and (3) device for coping with foreseeable adverse situations. Planning and monitoring your budget will help you identify wasteful expenditures, adapt quickly as your financial situation changes, and achieve your financial goals. When you actually see the breakdown of your expenses, you may be surprised by what you find; this process is essential to fully grasping how things can add up. Creating a budget will decrease your stress levels because, with a budget, there are no surprises. Why budget is prepared? Budget helps to aid the planning of actual operations by forcing managers to consider how the conditions might change and what steps should be taken now and by encouraging managers to consider problems before they arise. It also helps co-ordinate the activities of the organization by compelling managers to examine relationships between their own operation and those of other departments. Other essentials of budget include:  To control resources  To communicate plans to various responsibility center managers.  To motivate managers to strive to achieve budget goals.  To evaluate the performance of managers  To provide visibility into the......

Words: 1118 - Pages: 5

Budgets

...Management Of Any Business Will Be Ineffective Without The Preparation And Use Of Budgets. Introduction I agree that without the preparation and use of budgets, management of any business will be ineffective. Budgeting in general aids a company in many ways. With a budget, companies or businesses will be aware of the amount of money they have to either start up a business or to ensure smooth operation within the company. Using budgets also ensure that companies do not spend more than what they can afford so as to not carry a debt more than what they can afford to pay in the near future. Budgeting also allow companies to work out what they can afford and to also plan in advance how and in what channel the capital will be used for to further better the company. Arguments For * Budgeting assists with the achievement of the organisation’s objectives. Any business will definitely have objectives which they are trying to attain and with the help of budgets, the business would be able to work out their strategic and tactical plans. With a clearer picture of how the company is spending its funds, the business will be able to set objectives which are more realistic. * Managers will have better control and would be able to make decisions based on the variance analysis. In the event that unfavourable variances are spotted, managers can take better action to tackle the problems. Some examples are as follows; in the case where the costs are too high, the......

Words: 1006 - Pages: 5

Budget

...tBeautiful, but Bold? Zeenat Jadwet, TY B, 3105 After winning an overwhelming majority on its own, the BJP has, in its first two policy statements—the railway budget and the Union budget—unambiguously initiated a recalibration of the government’s ideology towards the right. Clearly this is a government, emboldened, no doubt, by its 282 seats, yet many question how much of this was divulged in the highly anticipated budget. Principle of continuity was seemingly chosen over political consideration, causing many a people to question the intentions of Mr. Jaitley and the Modi Government. Reconciliation with a flawed inheritance, is what Is evident by the budget, leaving expectations of path breaking reforms, or “Modification”, postponed if not shattered. This said, the budget does very successfully incorporate small, viable steps aimed at curing long standing issues of deficit, investor skepticism and inflation. Faced with a near-empty treasury and massive outstanding obligations, Mr. Jaitley had very little room to maneuver. It was either quoting a more realistic fiscal deficit, thereby corroding investor confidence or accepting the rather wishful goal of Mr. P. Chidambaram of 4.1% for 2014-15, which he invariably did. This though is based on the premise of growth in the coming months. Accepting that full disclosure would leave a scar on the rather upbeat mood, subjecting the ‘Ache din’ promise to mockery the Jaitley-Modi duo stuck to the UPA II guidelines. If the...

Words: 1639 - Pages: 7

Budget

...UNION BUDGET 2014 - 2015 UNION BUDGET 2014 - 2015 INDEX o o o o Key Highlights Tax Rates: Direct Taxes Market movements: Equity & Debt Economic update: o o o Budget summary Revenue snapshot Expenditure snapshot Sector updates Financial Sector Mutual Funds o o Equity Market: Outlook and Strategy Debt Market: Outlook and Strategy 1 UNION BUDGET, 2014 - 2015 KEY HIGHLIGHTS On the back of a decisive mandate, the first budget of the NDA government has laid out a broad policy framework in terms of sustained growth along with fiscal prudence. The finance minister has presented the budget amidst challenges like sub 5% growth and high level of inflation. The budget stresses the need to revive growth in manufacturing and infrastructure sectors. It also highlights the importance of improvement in Tax to GDP ratio and Non-tax revenues. • Tax revenues budgeted at 10.6% of GDP in FY15. • Tax budgeted to grow at 20% in FY15 compared with 10% growth seen in FY14 • Assumption of nominal FY15 GDP growth of 13.4%. • Retains fiscal deficit target at 4.1% of GDP. • Increased divestment target of Rs 634 bn • Boost to domestic manufacturing and investments, particularly in infrastructure and export-oriented manufacturing sectors • PPF scheme annual ceiling enhanced to Rs 1.5 Lakh p.a. from Rs 1 Lakh at present • Personal income tax exemption limit raised by Rs 50,000/-, to Rs 2.5 Lakh • Investment limit under section 80C of the Income tax Act raised to......

Words: 4977 - Pages: 20

Budget

...STATES DEPARTMENT OF DEFENSE FISCAL YEAR 2014 BUDGET REQUEST APRIL 2013 OFFICE OF THE UNDER SECRETARY OF DEFENSE (COMPTROLLER) / CHIEF FINANCIAL OFFICER Preface The Overview Book has been published as part of the President’s Annual Defense Budget for the past few years. This continues for FY 2014, but with modifications as proposed by congressional staff. From FY 1969 to FY 2005 OSD published the “Annual Defense Report” (ADR) to meet 10 USC Section 113 requirements. Starting with the President’s FY 2006 Budget, this report was no longer produced. Subsequently, the Overview began to fill this role. This year to ensure compliance with Section 113, new chapters are added to include reports from each Military Department on their respective funding, military mission accomplishments, core functions, and force structure. Key initiatives incorporated in the FY 2014 Defense budget. Our budget is formulated based on aligning program priorities and resources based on the President’s strategic guidance. This year’s budget involves key themes to: achieve a deeper program alignment of our future force structure with resource availability; maintain a mission ready force; continue to emphasize efficiencies by being even better stewards of taxpayer dollars; and continue to take care of our people and their families. Implementing Defense Strategic Guidance. The FY 2014 budget request continues the force structure reductions made in the FY 2013 budget request. Following the President’s......

Words: 74297 - Pages: 298

Expectations

...My Expectation About the Study of Marketing MY EXPECTATIONS ABOUT MARKETING MANAGEMENT AND MY ESTIMATION ON HOW IT WILL HELP ME IN MY CAREER OR ENTREPRENEURSHIP PATH Marketing management is explained by the American Marketing Association (1985) as the process of planning and executing the conception, pricing, promotion and distribution of ideas, goods and services to create exchanges that satisfy individual and organisational objectives. As a managerial function marketing management is not solely important to the marketing manager only but also necessary to any individual who wishes to develop him or herself in his or her carrier and business. In pursuing this course, I expect to be equipped with knowledge in advertising, promotion, pricing and the distribution of ideas, goods and or services so as to be able to make an informed contribution when decisions concerning marketing in to be made. Knowledge in marketing management will equip me with skills that will make me innovative in my career by knowing which ideas to bring forth to get things working right. Specifically, ideas that will bring positive changes rather than following every decision on marketing made because of lack of knowledge in the field. I also expect to acquire knowledge in managerial skills that will widen my career options. Knowledge in marketing management may guarantee my selection for a job placement in the area of marketing or even better my chances of selection for placement in my career field...

Words: 328 - Pages: 2

Budget

...is a continuous process of directing and allocating financial resources to meet strategic goals and objectives. The output from financial planning takes the form of budgets. The most widely used form of budgets is Pro Forma or Budgeted Financial Statements. The foundation for Budgeted Financial Statements is Detail Budgets. Detail Budgets include sales forecasts, production forecasts, and other estimates in support of the Financial Plan. Collectively, all of these budgets are referred to as the Master Budget. We can also break financial planning down into planning for operations and planning for financing. Operating people focus on sales and production while financial planners are interested in how to finance the operations. Therefore, we can have an Operating Plan and a Financial Plan. However, to keep things simple and to make sure we integrate the process fully, we will consider financial planning as one single process that encompasses both operations and financing. Start with Strategic Planning Financial Planning starts at the top of the organization with strategic planning. Since strategic decisions have financial implications, you must start your budgeting process within the strategic planning process. Failure to link and connect budgeting with strategic planning can result in budgets that are "dead on arrival." Strategic planning is a formal process for establishing goals and objectives over the long run. Strategic planning......

Words: 5904 - Pages: 24

Budget

...Introduction and Background of Budget The Capital Budget of the public sector or sometimes also known as Public Budget concerns how the government plans its revenues and expenditures at the Federal level, State level, and Local government level, to carter for the needs of its development programs and projects. In a democratic society, the division of resources between the public and private sectors is roughly determined by the desires of the electorate. But because it’s such a complex and time-consuming task to acquire adequate political information, the electorate is chronically ignorant. Since the Revolutionary War, democratic system of governance has forever been looking for better ways to inform the public and to design more sophisticated techniques for deciding how best to allocate scarce public resources. Despite the good sense it makes to “budget to a plan”, public expenditures are frequently approved based on who supports what, rather than on a clear understanding of what exactly the expenditures will accomplish. Public Budgeting is not about numbers; it is about making Democratic governance work. During the debates leading to the creation of the American Constitution, taxation and public expenditures were one of the driving forces leading to the creation of our peculiar and complex system of separation of powers and checks and balances. Our various state and local democratic constitutions give the executive branch the power to propose a budget and......

Words: 9430 - Pages: 38

Budget

...Evaluate the problems they have identified from unmonitored costs and budgets (D3) a) Using the budget completed in P6, identify, analyse and evaluate the key costs which were left unmonitored. b) Evaluate which unmonitored cost will lead to (or may not lead) to severe problems for Gordon Brown Ltd. Justify your answer and make three recommendations on how to overcome the problems Inadequate planning: As in most businesses, Gordon Browns budget will involve planning for both short and long term needs of the business. If a business’s financial plans and budgets figures focus only on the short term, then there is a risk that future profit opportunities and real economic realities may be ignored /or not given adequate considerations. Gordon browns business needs to learn from past mistakes and avoid these mistakes in planning for the future. 1. Projections may be overstated. Budgets and projections needs to be realistic and achievable. Business decision makers and investors may be fooled by numbers in the short term, but in the end the company almost always gets hurt. A realistic budget takes gives adequate considerations to the business’ activities, competition, cost and state of the economy. It may lengthen the search for funding and profit, but when the money does arrive, it will be honest money. This helps to ensure that the business does not over-promise and under-deliver its targets. Stakeholders, customers and staff are also encouraged and......

Words: 1561 - Pages: 7

Budget

...Personal Budget Exercise – MS Excel For a review of the complete rubric used in grading this exercise, click on the Assignments tab, then on the title Personal Budget (Excel) click on Show Rubrics if the rubric is not already displayed. Creating a spreadsheet to track personal expenses is an excellent use of Microsoft Excel. For this exercise, you will create a spreadsheet to enter a personal budget and track actual expenses for the year. You may choose to use real data or create a fictitious budget using a monthly income amount of $3,500 Here are suggested budget categories if you are not using a real budget. At a minimum, you must have 9 budget categories: Housing (mortgage or rent) | Food | Utilities | Miscellaneous | Car payment | Entertainment | Insurance | Gas | Student Loans | Savings | | Requirement | Points Allocated | Comments | 1 | Open Excel and save a blank worksheet with the following name:“Student’s First InitialLast Name Excel” Example: JSmith ExcelSet Page Layout to Landscape | 0.1 | Use Print Preview to review how spreadsheet would print. | 2 | In the worksheet, insert a Custom Header titled, "My Personal Budget." | 0.25 | This Custom Header text must be Arial 14 point, Bold, and be centered on the page. | 3 | Add a custom Footer with your name in the Left Section and automatic pagination in the Right Section. | 0.25 | Text format is Arial 10 point Normal. | 4 | Enter column headings :BUDGET ITEM, PROJECTED COSTS and the 12......

Words: 1765 - Pages: 8

Budget

...Budgeting: A Guide for Small Nonprofit Organizations A free resource provided by the Virginia Society of Certified Public Accountants Budgeting: A Guide for Small Nonprofit Organizations A free resource provided by the Virginia Society of Certified Public Accountants Introduction • Selecting the budget committee • The task of the budget committee • Setting budget priorities and realities — revenues • Setting budget priorities and realities — expenses and costs • When to prepare the budget • A budget for cash flow • A budget for capital expenditures — bought or received • Restricted grants • Changes to the budget • Conclusions Introduction Nonprofit organizations (NPO) wrestle continually with maintaining and improving their operations, especially during today’s uncertain economy. In short, NPOs must constantly strive for sustainability. A well-planned budget will focus on the primary goals and objectives of the organization and provide financial and programmatic adaptability — key ingredients to maximize sustainability. Every volunteer brings to a small NPO the enthusiasm and interest necessary to do a good job. These volunteers are critical to an NPO’s success, because most small NPOs lack the funds necessary to seek and pay for professional guidance in the business world. This guide is written to present the theories and practicalities of budgeting for the small NPO staffed by volunteers, whose expertise do not always......

Words: 3825 - Pages: 16

Budget

...UNION BUDGET 2012-13 16 March 2012 INTRODUCTION The Indian Government finds itself in an unenviable economic position at the current moment. First, the tight monetary policy adopted by the RBI in the past months has led to a dip in GDP growth rates, from the 9% figure projected in the previous budget to a modest 6.9%. Second, there has been an increase in the fiscal deficit, which can be explained by lower than expected revenue collections from taxes (due to slowing growth), low disinvestment and spectrum sale revenues, and the growth of subsidies leading to an increase in government expenditure during FY 2011-12. India’s fiscal deficit during FY 2011-12 was 5.9%, far above last year’s budget estimate of 4.6%. Third, given the current volatile political scenario, the government has to project a pro-common man image. Budget 2012-13 appears to be a realistic budget, balancing the objectives of financial prudence, GDP growth and populist measures. Most of the policies put forth in this budget were along expected lines. And, the initial response from the stock market supports the same. Fiscal prudence The finance minister clearly outlined measures the government is taking to increase its revenues, including increasing the service tax rate to the pre-stimulus level of 12%, increasing excise duty to 12% and setting a disinvestment target of Rs. 30,000 crore for the year. This budget’s big idea was the introduction of systems to enhance the simplification of tax laws,......

Words: 2485 - Pages: 10

Budget

...Prelude The Union Budget for 2012-13 (FY13) is to be presented in the Parliament on 16th March. As every year, the budget will be an event that would signal the direction set forth for the growth path of the economy. Global as well as the domestic investors would also be looking for signals. The attempt of the government to push for higher growth without sound economic fundamentals has further resulted in higher inflation, increased current account deficit, tighter inter-bank liquidity, and sub-optimal utilization of the tax payers’ money. The major expectations that surround the budget can be summarized as below: Sustainability in curbing government expenditure to check on the imbalances created by the fiscal deficit, without curbing consumption; Managing current account deficits and trade imbalances; Direction to catapult private investment, gross capital formation; Managing supply side constraints; and Empowering the under privileged with skills and knowledge for self-sustenance. A revival in investment cycle should be the way forward for the economy to drive a revival in productivity, rather than depending on consumption to drive productivity. Further, the supply side constraints, if exist for a prolonged period, would cripple the economy and the government would require greater fiscal and......

Words: 7509 - Pages: 31