Hsm 260 Final

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HSM 260 Final February 23,2013 Calculation of Ratios: Ratio | 2003 | 2004 | Current Ratio = Current Asset Current Liability | 0.87 | 0.90 | Long-Term solvency Ratio = Total Asset / Total Liability | 1.38 | 2.06 | Contribution Ratio = Largest Revenue Source/ Total Revenue | 0.51 | 0.49 | Management Expense Ratio = Management Expense/Total Expense | 0.282 | 0.226 | Program Expense Ratio = Program Expense/Total Expense | 0.66 | 0.72 | Revenue Expense Ratio = Total Revenue/Total Expense | 0.945 | 0.111 | Importance of Ratios: Current Ratio: Current ratio measures the capability of the company in paying current liability. Higher the current ratio, better the liquidity position of the company. Generally, a current…show more content…
It helps in comparing past financial data with current one. Another advantage to line-item budgets is that they are clear and simple to read. Sometimes line-item budget provides little information on the overall use of fund and so, it is hard to justify the amount allocated to a particular line item. Program Budget: In Program Budget, expenditures are based primarily on programs of work and secondarily on character. Proposed expenditure in the budget is set by analyzing function. It allows top management to focus on objectives for which funds are allocated. It is easy to find for which function fund is used. However, program budget does not properly evaluate performance. Performance Budget: Performance budget is compilation of programs and activities of different departments. It focuses on

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