Jet2 Task 2

2611 Words Jan 2nd, 2014 11 Pages
JET2 TASK 2 1

JET 2 TASK 2: Financial Analysis Theo Adams Western Governors University MBA Program

JET2 TASK 2 2 (A1) Budget Concerns

Investopedia defines Budget as an "estimation of the expenses and revenues over a specific future period of time. Budgets can be made for a group of people, family, person, country, business, government, organization or anything else that makes or spend money. The budget is a micro economic concept that shows the trade-offs made when one good is exchange for another." When looking at the year 9 budget for CB first thing that jumped out at me was the sales goal of 3510 is a 5247450. This is my first immediate concern considering that the storyline has clearly stated it is a down market due to the
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The second is listed at 150000 in the Selling, General & Administrative Budget within the Facility & General Operations Level Expenses. The last of the three line item that references to Utilities shows up in the same exact section and has the amount of 54000. This was extremely convoluted and seems redundant for the Utility costs. Beyond the confusion, the totals of the three Utility costs came out to 259747 for the year 9 Utilities expenses. These totals in cost for the utility related expenses seems very high compare to the year 8 utility expense of 150,000. With this said CB should consider a revised budget that is more detailed and gives a clearer explanation for the line items pertaining to the utility expenses.

JET2 TASK 2 9

JET2 TASK 2 10 Lastly the CB budget as a whole is somewhat of a concern because it has so many miscellaneous expenses that are not detailed and referred to as "Other" be it Asset or Liability and Also because it is a Annual Budget considering CB is a company whose product is a seasonal one ( competitive bicycle racing is a Spring and Summer sport) CB should use a quarterly budget or have a quarterly budget broke down as part of their annual budget. Not to mention that within the storyline a monthly budget is referenced being used for the purchasing department in order to purchase raw materials. The overall

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