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Unformatted text preview: It is expected that one might be a few dollars over or under when budgeting. I am not sure a manager should be punished or rewarded. However, that being said a manager should be aware of operating expenses of his or her department. Making large errors in estimating a budget can cause the company to lose money if expenses are not correctly estimated. Also overestimating can have an adverse affect on the company as well as money budgeted in areas that it was not need may have been needed in other areas. Budgets can be difficult for a new business because one just might not know of all the expenses that will occur. A business of many years is a bit easier to budget for as one can compare prior years or periods to see where increases or decreases have occurred. Having historical data to refer to will make the job much easier....
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This note was uploaded on 02/16/2012 for the course ACCOUNTING ACC561 taught by Professor Jardine during the Spring '12 term at University of Phoenix.
- Spring '12