Budgeting

Budgeting

1. Objectives

   • Establish specific goals
   • Execute plans
   • Comparing goals to actual results

2. Human Behavior

   • When done right
     • It makes employees want to reach goals.
     • Motivates
   • When done wrong
     • Lack of interest from employees
     • Negative effect

3. Budgeting systems

   • Continuous Budgeting
   • Static Budget
   • Flexible Budget

4. Types of budgets

   • Sales
   • Production
   • Direct Materials Purchases
   • Direct Labor Cost
   • Cost of Goods Sold
   • Selling and Administrative Expenses
   • Financial
     • Cash
     • Capital expenditures