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Archives for the ‘Budgeting Methodology’ Category

Sales and production budget preparation

Category: Budgeting Methodology

Basic rules to observe The sales budget — what products at what prices plans the company to sell – is, as pointed out earlier, the starting point for preparing a budget. Three basic rules have to be observed when preparing the sales budget.

Typical work-steps for preparing a budget

Category: Budgeting Methodology

The preparation of the budget should always start with the compilation of the sales budget. The sales budget provides for information as to the quantities of product which the company realistically expects to sell and the prices which it expects to achieve.

The budgeting process. Principal, and other limiting factors

Category: Budgeting Methodology

Budgeting, as already pointed out earlier, always starts with the preparation of the sales budget., because the sales ultimately are the principal limiting factor determining the overall activity level.

Theoretical background for Budgeting methodology

Category: Budgeting Methodology

Putting together the budget for a company means to create a simulation of the business activities, which the company plans to undertake during the period for which the budget is prepared, i.e. generally one year;

Description of an adequate indirect cost planning and distribution system

Category: Budgeting Methodology

The complexity of budgeting for overheads (i.e. indirect costs) stems from the fact that overhead costs are not connected directly to individual products, orders or services as are direct costs.

Methodology for indirect cost planning

Category: Budgeting Methodology

The methodology presented in the following summarises solutions which have been developed in several Ukrainian companies faced with problems of indirect cost planning, allocation of indirect cost to the productive activities and product pricing.