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
State the price determination under the market condition The price determination under the following market condition is as follows: 1) Pure competition: in this situation

Transportation model Table A more compact method for representing the transportation model than the linear equations is to use what we call the transportation tableau. It is a

Compute the value of share of a company? A company paid dividend amounting to Rs. 0.75 each share during the last year. The company is supposed to pay Rs. 2.00 per share throug

Prepare a multiple step income statement, and classified balance sheet for XYZ Corporation for 2013 in good form. The income statement should include the proper earnings per share

2. Draw the network diagram for the following problem and indicate a sequence of plans that the company should want to consider in making a time-cost tradeoff. The company is not

Transfer Pricing Transfer pricing can contribute directly to the process of departmental performance measurement and indirectly to the measurement of product performance. A

what is Computerized Processing Systems

Standard costing in modern environment Standard costing has traditionally been associated with labor-intensive operations, but it can be applied to capital-intensive production

Explain TWO limitations of using accounting ratios to assess the performance of a firm and suggest how each limitation may be improved

Define performance budgeting according U.S. bureau of budget U.S. bureau of budget defines performance budget as one which presents purposes and objectives for which funds are