FREE online courses on Refresher on Financial Planning - Chapter 3 - Summary of the Budgeting Process

 

We started our budgeting process by looking at strategic planning. Strategic Planning should always be the starting point for financial planning. From the Strategic Plan, we develop a Plan of Action so we can implement the Strategic Plan. This is often called an Operating Plan. Within the Operating Plan, we will include a set of budgets for successful implementation of the Strategic Plan. The entire set of budgets can be categorized as follows:

 

< - - - - - - - - - - - - - - - - - - - - - - - - - - Master Budget - - - - - - - - - - - - - - - - - - - - - - - - - >

< - - - - - - - - - - - Operating Plan - - - - - - - -> < - - - - - - - - - Financial Plan - - - - - - - - ->

Sales Forecast (Exhibit 1)                       Budgeted Retained Earnings (Exhibit10) Budgeted Production (Exhibit 2)                Budgeted Capital Expenditures (Exhibit 11)

Budgeted Production Costs (Exhibits 3-5)   Change in Fixed Assets (Exhibit 12)

Budgeted Cost of Goods Sold (Exhibit 6)    Budgeted Balance Sheet (Exhibit 13)

Budgeted Operating Expenses (Exhibits 7-8)         Cash Budget (Exhibit 14)

Budgeted Income Statement (Exhibit 9)