Public financial management, Corporate Finance

Assignment Help:

You are planning to open a homeless shelter called Helping Hands Mission Inc. in fiscal year (FY) 2011. You expect to have 60 beds and to operate at full capacity throughout the year. You expect food to cost $25 per person per week and laundry to cost $10 per person per week. You plan to pay one full-time staffer an annual salary of $40,000 plus $10,000 in benefits, and a second part-time staffer an annual salary of $20,000. You plan to pay all of the aforementioned costs promptly as they are incurred. You expect to pay $5,000 per month to rent a furnished space and $2,000 per year for insurance; rent is due on the first day of each month and the full insurance payment is due on the first day of the year.

The city has agreed to reimburse you for $40 per person per week; you will receive weekly checks from the city with a four-week lag (i.e. four weeks after service has been delivered). You also expect to receive $80,000 in contributions, spread evenly throughout the year. You are not planning to borrow or invest any funds during the shelter's first year of operations.  

a)  Using the template on the course website, prepare an annual operating budget for FY 2011 on the accrual basis of accounting. 

b)  Prepare a quarterly cash budget for the shelter for FY 2011. (Hint: assume that there are 3 months or 13 weeks in a quarter. Do not try to convert weeks to months or vice versa!)

c)  Write a few sentences explaining which factor(s) are driving the difference between the shelter's expected  profit/loss  on the operating budget and annual  ending cash balance on the cash budget.

d)  Write a few sentences explaining some ways in which you might want to revise your plans for fiscal year 2011 in light of the shelter's expected profit/loss and ending cash balance.


Related Discussions:- Public financial management

Ranking projects: NPV vs IRR Conflicts, how can i rank a project when there...

how can i rank a project when there are conflict between IRR & NPV

The pure-play approach, Hydra Multinational is a vast conglomerate firm inv...

Hydra Multinational is a vast conglomerate firm involved in a wide array of business ventures ranging from satellite radio to cat food.  One of its many divisions, a restaurant cha

Interest Rates and Bond Valuation, Bond J is a 4 percent coupon bond. Bond ...

Bond J is a 4 percent coupon bond. Bond K is a 12 percent coupon bond. Both bonds have 8 years to maturity, make semiannual payments and have a YTM of 7 percent....what are the mon

Answer required ., What will be impact on the operating leverage of a firm,...

What will be impact on the operating leverage of a firm, if it proceeds for additional borrowings?

Determination of the best ordering policy in organisation, Determination of...

Determination of the Best Ordering Policy in Service Organisations In service organisations, the role of procurement is less developed than in manufacturing. This has been due

Find weighted average cost of capital - yield to maturity, Monsanto Company...

Monsanto Company has 3 million shares, selling at $25 each. The company has just paid a dividend of $1.35 and the next year's dividend is expected to be $1.50, which is in line wit

Discuss assumptions underlying the diversification theory, Question: a)...

Question: a) You have just been appointed a portfolio manager of Malou investment. An investor has two assets available from which to form his desired portfolio. Asset X has a

Review of Revenue, Review of Revenue This activity will require you to acc...

Review of Revenue This activity will require you to access at least a portion of the federal budget as well as a state, local and an agency budget. This can be done online. Howeve

Cash flow from an income statement, Describe how to build a cash flow from ...

Describe how to build a cash flow from an income statement.

Defining phoenix activity, A key challenge for any analysis or discussion o...

A key challenge for any analysis or discussion of phoenix activity is how to define the problem. There is currently no definition in Australian legislation. The approach in Austral

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd