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Exam#3 Study Guide

Exam#3 Study Guide - BMGT 221 T 221 EXAM#2 STUDY GUIDE...

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GT 221 EXAM#2 STUDY GUIDE BMGT 221 Exam #3 Study Guide CH-9 Budgets A How and Why 1. Purpose To express plan, to access and to reach goals; to plan for the future, and to control the revenue and expense 2. Development a. Step: Long-term strategic goal >>> key strategies b. Strategic planning (p476) c. Rolling budget (p477) d. Participative budgeting (p477) e. Start point: based on previous year/zero-based budgeting (p477) 3. Benefit a. Planning: to plan for the future, rather than only consider daily operation b. Coordination and communication: to consider relations among operations across value chain c. Benchmarking: to motivate employees, and to help evaluate performance 4. Master budgets (p479) a. Operation budget (p479) (accrual bases), starts with sales budget (Sale budget-production budget-DM, DL, MOH budgets-operation expense budget, budgeted income statement b. Financial budget (cash bases) (Capital expenditures budgets-cash budgets-budgeted balance sheet) B Operation budgets a. Sales budget (p481) Total expect sales revenue =Expected no. of unit sales x expected sales price/unit b. Production budget (production > sales) (p482) Safe stock (p481) Units to produce = Unites needed for sales + desired ending inventory (X% of next month’s sales) – units in beginning inventory (X% of current month’s sales) c.
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