Budgeting systems turn managers’ perspectives forward and by looking to the future and planning, managers are able to anticipate and correct potential problems before they arise (Horngren, Foster & Datar, 2000). Through budgeting, management can plan ahead and maintain enough cash to pay creditors, to have adequate raw materials to meet production requirements, and to have sufficient finished goods to meet expected sales (Kieso, 2002).
While the traditional management accounting techniques may have contributed to planning, controlling and decision making processes at the nation state level, the requirements of globalisation in which nation states now compete for survival in the global market rather than state market, has rendered traditional techniques obsolete and therefore calls for the mobilisation of modern techniques of management accounting. It also calls for the service of accountants with modern management accounting techniques for a successful implementation.
This research paper is a brief discussion of budget management analysis. Budgeting is the key to financial management, and is the key to translates an organization goals or plan into money. Budgeting is a rough estimate of how much a company will need to get their work done, and provides the basis for evaluating performance, a source of motivation, coordinating business activities, a tool for management communication and instructions to employees. Without a budget an organization would be like a driver, driving blinded without instructions or any sense of direction, that’s how important a budget is to every organization and individual likewise (Clark, 2005).
In order to complete the study, research questions were developed with specific variables in order to determine the results
Rothschild, J. M., Lee, T. H., Bae, T., and others. "Survey of Physicians' Experience Using a Handheld Drug Reference Guide." (Presented at AMIA 2000 Annual Symposium). American Medical Informatics Association, Los Angeles, California, March 2000.
Financial Statement Analysis Project -- A Comparative Analysis of Kohl’s Corporation and J.C. Penney Co
“Ending Inventory” = “Beginning Inventory” ($22,000) + “Purchases” ($30,000) – “Cost of Goods sold” ($24,000) = $52,000 - $24,000 = $28,000
Assume that Pittman Company decides to continue selling through agents and pays the 20% commissions rate. Determine the volume of the sales that would be required to generate the same net income as contained in the budgeted income.
CF is the new controller for the consumer division of ABC company. In the past five years, ABC’s earnings have grown by at least 15% annually, with the consumer division’s earnings growing by over 20% annually over the same time-period. In the 4th quarter of the current year, however, it is projected that consumer’s income will grow by 8% and ABC’s will grow by 10%. ML, consumer division’s president, wants CF to take some of the following “end of the year” actions in order to improve consumer’s reported earnings. Under the previous controller, these types of actions were more or less taken as acceptable practices.
|11. |Fox Company's contribution margin ratio is 20%. If the degree of operating leverage is 15 at the $225,000 sales level, net |
COGS (Cost of Goods Sold) is an “inventoriable cost” ( recorded in the Balance Sheet as inventory and expensed (Income Statement) when goods are sold
The traditional product-costing system undercosts the Satin Sheen product line, with respect to quality-control costs by $525
Budgets are needed by many organisations and have been used since 1922, they’re considered to be key drivers and assessors of performance within a business. They’re mainly used in an attempt to plan and control organisations and their objectives. An organisation’s political structure is mainly affected by budgets as the managers at the top tend to use budgets as a means of power and authority. Traditional budgeting has both advantages and disadvantages; recently, critics seem to be against the use of traditional budgets within organisations. This is due to traditional budgeting being assumed to be very out of date; it has no way of being used in a contingency plan as it has nothing to do with the changes of markets. If the market
Traditional budgeting is the process of budgeting which is in use for the past many years in the organizations. It is based upon single basis; mostly indirect costs are distributed to all products and services. Often products which have higher volume are over costed. And the lower volume products are often understated. It is incremental in nature; old techniques are used, have a short term view and mainly deal with smaller segments. Traditional budgeting takes no account of the fact that income are uncertain, unplanned things arises, that social, political, economic situations change without warning and stock markets rates moves unpredictably. Traditional budgeting is now outsourced in most organizations. This is due to the effect that budgeting serves
One of the most non-value-added activities within financial management is budgeting. Budgets are prepared to allocate and control how resources will be used in the future. Unfortunately, the future is hard