Budgets, Managerial Accounting

Budgets

An essential planning component is budgeting. Budgets sketch the financial plans for an organization. There are number of budget types.

Operating Budgets -- A plan should provide definition of the anticipated revenues and the expenses of an organization and more. These operating budgets can become quite detailed, to the level of mapping of specific inventory purchases, staffing plans, etc. The budgets, oftentimes, delineate permissible levels of expenditures for various departments.

Capital Budgets - Operating budgets will also reveal the requirement for capital expenditures relating to new services and equipment. This longer term expenditure decisions should be evaluated logically to that determines whether an investment can be justified and what rate and the duration of payback is likely to happen.

Financial Budgets -- A company should assess financing requirements, including the evaluation of potential cash shortages. These tools enable companies to meet with lenders and that demonstrate why and when additional support may be required.

The budget process is very much important doesn't matter how painful the process may seem it is important to the viability of an organization. Several of the succeeding chapters are dedicated to helping you better understand the nature and the elements of the sound budgeting.

 

 

Posted Date: 7/21/2012 3:11:56 AM | Location : United States







Related Discussions:- Budgets, Assignment Help, Ask Question on Budgets, Get Answer, Expert's Help, Budgets Discussions

Write discussion on Budgets
Your posts are moderated
Related Questions
Determine the tyoes of Cost centre Cost centre can be of two kinds: 1. Impersonal cost centre: consisting of a location or item of equipment (or group of these) like machi

Kinematic Pair: A pair is a joint of two elements which permits relative motion. The relative motion among the elements of links that built a pair is needed to be fully constrain


Explain standard costing according to backer and Jacobsen According to backer and Jacobsen, standard cost is the amount the firm to measure the variation from standard costs th

Characteristics of product life cycle The major characteristics of life-cycle concept are as follows: 1) The products have finite live and pass by the cycle of development i

Phases of product life cycle The life cycle of a product having of four phases viz., introduction growth maturity decline during introduction phase a product is launched into

stanley shoe company established a line credit with a local bank. the maximum amount that can be borrowed under the terms of the agreement is $100000 at an annual rate of 12%. a co

Introduction to pricing decision A pricing decision is one of the most crucial and difficult decision that a firm has to make. It is one of the most difficult decisions. Such

solutions for (POS) slow printing of sales tickets and unpredictable action of cash drawers. when credit approvals delayed the checkout process or when the computer was down, thus

Explain Direct labor cost standard The setting up of standard labor cost for each product would require: a) The determination of budgeted fixed overhead for a period b) B