Category Archive for: operational budgeting

Computers and Flexible Budgeting Adjusting

the entire budget to reflect a different level of sales or production would be a sizable task in a manual system. In a computer based system, however, it can be done quickly and easily. Once the cost-volume-profit relationships have been entered into a budgeting program, the computer almost instantly performs the computations necessary to generate…

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Budgeted Accounts Receivable (Schedule 88)

 As shown below, the beginning accounts receivable balance, plus credit sales and minus collections on account, equals estimated ending balance of accounts receivable. The Cash Budget Using NTl’s financial budget estimates from Schedules B/ through 88, the cash budget that follows is developed for the first two quarters of 2000: NTI’s budgeted cash position for…

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Means of Financing Costs and Expenses (Schedule 82)

The next step in preparing a cash budget is to estimate the portion of budgeted costs and expenses that will require. cash payment in the near future. Certain expenses will not require an outlay of cash. These include (1) expenses that result from the expiration of prepaid items (such as insurance policies) and (2) the…

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Manufacturing Cost Estimates (Schedule A3)

 Lisa Scott, NTI’s cost accountant, has thoroughly analyzed the company’s variable and fixed manufacturing costs. She is confident that variable. manufacturing costs per unit will not increase during the first half of 2000. She also believes that fixed manufacturing overhead will hold steady at approximately’$ 15,OOOper quarter. Based on her analysis, she compiled the following…

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The Budget Period

As a general rule. the period covered by a budget should be long enough to show the effect of management policies but short enough so that estimates can be made with reason able accuracy. This suggests that different types of budgets should be made for different time spans. Capital expenditures- budgets. which summarize plans for…

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BUDGETING THE BASIS FOR PLANNING AND C0NTROL

IS a comprehensive plan setting forth the expected route tor achieving the financial are operational goals of an organization, Budgeting is an essential step in effect: an planning. Even the smallest business will benefit from preparing a formal written plan for its future operations, including the expected levels of sales. expenses, net income, cash receipts,…

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PROFIT RICH YET CASH POOR

LO 1 In January of 1999, Nancy Conrad founded Network Technologies, Inc. (NT!). NTI man Explain how a company can manufactures a screening device designed to safeguard personal computers against viruses b profit rich, yet cash poor.” transmitted through networks. Unlike disinfectant programs that remove viruses from infected hard drives, the NTI product actually screens all…

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I’D LIKE THE WORLD TO aUYA COKE

In 1954, Robert C. Golgotha answered a help-wanted advertisement for a chemical engineer in a Havana newspaper and,went to work for The Coca-Cola Co. Twenty-six years later, the Cuban-born executive triumphed in a bruising battle for Coke’s top job. Named-president In May of 1980 and elected Chairman and chief executive 10 weeks later, Ghettoize had…

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