Operational and Financial Budgeting Flashcards
A formal expression of plans, goals and objectives of the management
Budgeting.
- time period is important
Kind of plan that focuses on longer period of time
Strategic Plan
Should include your action necessary for your strategic plan to happen
Tactical Plan
The type of plan that is normally one year.
Operational Plan
Planning for a result and controlling to accomplish the result
Budgeting.
You determine the process. This is doable.
Budgeting
Predicting the outcome of events. You include things you cannot control. So you anticipate the things you will do.
Forecasting
The main difference between budgeting and forecasting
Level of Influence/Level of Control
How do you compute for the predetermined unit cost?
Budgeted Cost / Budgeting Level of Activity.
Predetermined Unit Cost is also known as standard cost
What part of the process where cost accounting is happening?
Organizing
Where do you create the budget?
Planning
What are the attributes of effective budgeting?
Predictive Value
Assists Communication
Enhances Understandability
Reliable and Timely
If the budget is created from the top management communicated to the lower management
Topdown. If in the rush, this is used.
If the budget is created from the lower management communicated to the upper management
Bottom Up
