ACC561 Week 4 Team Assignment

ACC561 Week 4 Team Assignment - Guillermo Furniture 1...

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Guillermo Furniture Guillermo Furniture Barbara Anderson, Celaine Harrington, Myishia Smith, Pamela Spivey, Kalyn Wenzlawsh UOP / ACC 561 Christa Gallup July 12, 2010 Guillermo Furniture 1
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The Guillermo Furniture Store has been conducting business as premier furniture makers in Sonora, Mexico for many years (University of Phoenix, 2010). The budget system that Guillermo Navallez has been using for his company is in need of revision. In addition to the revised flex budget provided, there are impacts that are discussed about the budget. The first involves the risks associated with the use of sales forecasts. The ethical considerations that were involved when creating the budget are also discussed. Finally, the uses for the new budget are evaluated. Sales Forecasts A sales forecast is a prediction of sales under a given set of conditions. Sales forecasts are usually prepared under the direction of the top sales executive (Horngren, 2008). The sales forecasts are derived from the company’s most recent sales trends. Sales forecasting is management's primary instrument for predicting the degree of reasonable sales. As a result, the complete budget process reflects correct and well-timed sales. Sales f orecasts are a very important process to ensure that the best strategic business decisions are made on behalf of the company. Sales forecasts are used for a variety of reasons and risks are associated. There are production risks, resource risks, and financial risks, which can all be affected by under or over forecasting. Sales forecasting is an inexact science, and Guillermo’s Furniture will be faced with challenges. Ethical Dilemmas
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This note was uploaded on 10/17/2010 for the course MBA 561 taught by Professor Various during the Spring '10 term at University of Phoenix.

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ACC561 Week 4 Team Assignment - Guillermo Furniture 1...

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