Unformatted text preview: RDLE: THE BOOK ON BUSINESS PLANNING The simpler model totals all payroll only. It is perfectly appropriate for a lot of small businesses. You
can use each of the lines in the table to describe speciﬁc individuals, or groups and departments.
When you have the list complete, just add up the totals for personnel costs in your Proﬁt and Loss,
discussed in Chapter 15: The Bottom Line. Multiply that total times your burden rate — say 15 or 20
percent — to calculate your personnel burden. The burden goes into the proﬁt and loss as a separate
The next illustration shows the more detailed personnel plan that divides the rows into categories,
such as sales and marketing, general and administrative, and so forth. The more detailed model
shown here totals the planned payroll for each of the four departments, and then calculates total
payroll. DETAILED PERSONNEL PLAN The more detailed personnel plan shown here divides personnel expenditures into classiﬁcations
including production, sales and marketing, administration, and other. CHAPTER 8: MANAGEMENT TEAM 8.5 An alternative plan estimates total people per department, and the average salary per department.
This can be a useful way to project growth of personnel in a high-growth mode requiring rapid
addition of people. The next illustration shows an example of this personnel projection method. HEADCOUNT-BASED PERSONNEL PLAN This personnel plan shows personnel expenditures by people per department and spending per person.
For any of these three personnel tables, you also want to calculate a payroll burden as a percentage
of the total, and make sure to include the personnel burden amount among the operating expenses,
usually as a separate line in Proﬁt and Loss.
The payroll assumptions in this model will also be used for the other ﬁnancial projections. The Proﬁt
and Loss (also called income statement) will use personnel plan numbers. Summary
Your personnel plan is actually just an educated guess. It is hard to make this kind of g...
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This note was uploaded on 01/26/2014 for the course BUINESS 102 taught by Professor Unknown during the Winter '09 term at University of Phoenix.
- Winter '09