Professional Documents
Culture Documents
Planning
Controlling
The Work of Management
Initiate LT &
Planning
ST Plans
Measure
Controlling
Performance
The Work of Management
Initiate LT &
Planning
Planning
ST Plans
Planning -- involves
Evaluate
developing Decision
objectives Organizing
Implement&
Evaluating
Performance Directing
Plans
Making
and preparing various
budgets to achieve these
objectives.
Measure
Controlling
Performance
The Work of Management
Control
Initiate LT & involves the
Planning
steps
ST Planstaken by
management that
attempt to ensure the
Evaluate Decision Organizing
Implement&
Evaluating
Performance objectives
Making
areDirecting
attained.
Plans
Measure
Controlling
Control Performance
The Work of Management
Initiate LT &
ST Plans
Measure
Performance
The Work of Management
Through
Planning
the budget
Measure
Performance
The Work of Management
Planning
According
Evaluate Decision Implement
to the Budget
Performance Making Plans
Measure
Performance
The Work of Management
Initiate LT &
Planning
ST Plans
Measure
Controlling
Performance
The Basic Framework
of Budgeting
A Budget is . . .
1 Year
5 Years
Short-Run Vs. Long-Run
Budgets
Strategic Planning
Selecting overall objectives.
Choosing what markets to be in.
Selecting what products to produce.
Determining the price/quality mix.
Deciding which technologies to use.
Short-Run Vs. Long-Run
Budgets
Strategic Planning
Long-run Budgets
Vs.
Participatory
Imposed Budgets Versus
Participatory Budgets
Imposed Participatory
Budgets Budgets
Continuum
Participatory Budgets
Continuum
Imposed Budgets Versus
Participatory Budgets
Imposed
Budgets
Best Time to Use . . .
In start-up organizations
In extremely small businesses
In times of economic crises
When operating managers
lack budgetary skills or perspective.
Advantages . . .
Participatory
Budgets
Best Time to Use . . .
In well-established organizations.
In extremely large businesses.
In times of economic affluence.
When operating managers have
strong budgetary skills
and perspectives.
Advantages . . .
Define goal
and objectives
Communicating Think about and
plans plan for the future
Advantages
Coordinate Means of allocating
activities resources
Uncover potential
bottlenecks
The
Master Budget
The Master Budget
Sales
Sales Budget
Forecast
Overhead
DM Budget DL Budget
Budget
Capital
Cash Budget
Budget
6 2 7
3 4 5
9 10
The Sales
Budget
4. Less BI of raw
materials.
1. Required purchases of
Direct Materials
The Direct
Labor Budget
A budget showing
expenses for areas other
than manufacturing.
The S&A Expense Budget
The Cash
Budget
The Budgeted
(Pro-Forma)
Income
Statement
The Budgeted
Balance Sheet