Case Study 3 Accounting

A budget plan is the most effective way to keep the business and its finances on track. It gives you the opportunity to review the business’ performance and any factors that are affecting or may affect your business. Also to manage your money more effectively, allocate appropriate resources, monitor performance, meet planned objectives and plan for the future.

The cash budget is another aspect of budget expectation. The cash budget determines how much cash an organization have on hand, and how much is needed to meet each expense. The cash budget will reveal to companies the availability of any type of surplus the company has for short-term investments.

The budget process for each year begins by examining how much was spent each month. For each month, a budget is created for the following year. Staff members at the unit level impact the budget with supply usage.

George 's Train Shop is a family owned business that focuses on the sales and repairs of train toys. George is running a profitable business, but as he is aware of my MBA Managerial Finance class, he has asked for advice on his working capital practices. Although George is currently enjoying the benefits of a profitable business, there are opportunities for him to expand his business ventures. This first starts by dissecting degree of aggressiveness in working capital practices, current capital budgeting practices, and areas where he can improve in both arenas. In addition, careful management of the company 's cash flow will

Cash Budget is the evaluation of cash influx and efflux of a business for a particular period of time.

A company's budget serves as a guideline in planning and committing costs in order to meet tactical and strategic goals. Tactical goals such as providing budgetary costs for daily operations, and strategic objectives that include R&D, production, marketing, and distribution are all part of the budgeting process. Serving as a guideline rather than being set in stone, the budget is a snapshot of manager's "best thinking at the time it is prepared." (Marshall, 2003, p.496) The budget is a method in which to reign-in discretionary spending, and will likely show variances between what costs have been anticipated and what costs are actually incurred.

Budgeting in a business is important for so many reasons. Business leaders often deal with large amounts of money, and some employees or outsiders might see the organization's revenue as nearly limitless. Regardless of the business cash on hand, though, careful budgeting plays a critical role in any organization's success. Chester & Wayne is a large regional food distribution company and the CEO of the company has asked for some assistance in preparing a budget for their cash flow. With the information provided by CEO, Mr. Wayne, the budget will be carefully planned.

Budgets can aid planning, which gives a business direction. A budget takes the organisational plan (goal and objectives) and quantifies this into something real to aim for. Such forward planning aids anticipating future business

Question 1: The situation in this case study revolves around Sally, a member of the Board of Sally Susie's Donut Shop, Inc. (SSDS). SSDS uses an accrual method of accounting and over the past three years has seen volatile sales. Sally is unhappy with her previous tax advisor and wants new advice. Our task is to outline a preliminary interview with Sally to ensure that we ask the right questions.

A cash flow forecast is estimation of cash coming into the business and of cash going out of the business over a set period of time. A cash flow forecast should demonstrate that your business will have access to enough money to survive. But when estimating the costs you must give reasonable costs because if you estimate the expenses low and the profit high it will cause problems within the business.

Accounting is the comprehensive way keeping track of all financial transactions pertaining in a firm. It is considered to being the language of most firms nowadays where they are found to communicate their performances to the externals. In addition to evaluating and examining their employees performances using the information conducted by the different financial statements and reports.

Cash flow forecasts are a powerful management tool to help identify future deficits or surpluses in liquidity. The cash flow forecast shows the total expected outflows and inflows during a given period; i.e. a year. It is vitally important that this budget is prepared so the organization is aware of shortages and surpluses during the year. These can help the business spot cash problems and cash opportunities. A known cash shortage can be planned for and resolved proactively verses reactively. It would be wrong to assume that if the organization is in surplus that it does not have a problem. Idle cash means the opportunity to earn interest or

Looking at the analysis above, cash budget is important for Doomy Corporation to have, because it ties all of the rest of Doomy’s planning down to numbers and also timing. Also it is the roadmap where they believe they want to go so it helps them set goals in terms of what revenue

The management of cash is essential to the survival of any organization. Managing an organization’s financial operation requires knowledge of the economy and ways to maximize revenue. For any organization to operate on a daily basis adequate cash flow is required. Without cash management the organization will be unable to function because there is no cash readily available in case of inconsistencies in the market. Cash is also needed to keep the cycle of the company’s operations going.

The specialized budget can be defined as a customized aspect of a comprehensive budget. Specialized budget focuses on one aspect of financial activity for example loan or debt budgets. The cash budget shows budget details per month. The cash budgets are used to enter details of seasonal incomes and revenue. It is also used to estimate the amount of cash that goes in and out of a business enterprise for a particular period of time. It is used to determine if a business has enough capital needed for successful business operation. Another type of specialized budgets is the cash flow budgets.It primarily represents the cash inflow aspect of a comprehensive budget.Another type of specialized budget is a tax budget which is used for budgeting details that attracts taxes. For example, expenses, incomes and other expenditures that incur taxes like real estate, monetary gifts and so on. Ultimately, specialized budgets would still bee included in a comprehensive