Terms and also definitions for budgeting in general and also capital budgeting are likewise included here. Examine it out.

You are watching: The projection of financial position at the end of the budget period is found on the

Budget – A formal created statement that management’s plans for a specified future time period, expressed in financial terms.Static budget – A forecast of spending plan data at one level the activity.Participative budgeting – A budgetary approach that starts through input indigenous lower-level managers and works upward so that managers at all levels participate.Flexible budget – A forecast of budget plan data for assorted levels the activity.Master budget – A collection of interrelated budgets the constitutes a setup of action for a particular time period.Financial budgets – separation, personal, instance budgets that emphasis primarily top top the cash resources essential to fund expected operations and planned funding expenditures.Operating budgets – individual budgets that an outcome in a budgeted earnings statement.Budgeted revenue statement – An calculation of the supposed profitability the operations for the spending plan period.Sales budget – An calculation of meant sales revenue for the budget period.Merchandise purchases budget – The estimated cost of goods to be purchased through a merchandiser to accomplish expected sales.Production budget – A estimate of the devices that must be produced to satisfy anticipated sales.Direct materials budget – An estimate of the quantity and also cost of direct materials to be purchased.Direct job budget – A forecast of the quantity and cost of straight labor vital to meet production requirements.Manufacturing overhead budget – An estimate of expected manufacturing overhead costs for the budget plan period.Selling and also administrative cost budget – A projection of anticipated selling and administrative prices for the budget period.Budgeted balance sheet – A projection of financial place at the end of the budget plan period.Cash budget – A projection of guess cash flows.Sales forecast – The forecast of potential sales for the industry and the company’s supposed share of together sales.Budget committee – A team responsible because that coordinating the preparation of the budget.Budgetary control – The use of budgets to control operations.Budgetary slack – The amount by which a manager intentionally underestimates budgeted earnings or overestimates budgeted expenses in stimulate to do it simpler to accomplish budgetary goals.Long-range planning – A formalized process of choosing strategies to accomplish long-term goals and developing policies and also plans to implement the strategies.

Capital Budgeting Terms and Definitions

Capital budgeting – The process of making capital expenditure decision in business.Cost the capital – The price of return that management expects to pay on every borrowed and also equity funds.Annual rate of return technique – determines the profit of a funding expenditure by separating expected yearly net revenue by the average investment.Cash payback technique – identifies the time period required to recover the cost of a resources investment indigenous the net yearly cash flow created by the investment.Discounted cash flow technique – Considers both the estimated full net cash flows from the investment and also the time worth of money.Discount rate – attention rate offered in discounting the future net cash flows.Incremental evaluation – The process of identify the gaue won data that adjust under different courses the action.Internal price of return (IRR) – The rate that will cause the current value that the proposed capital expenditure to equal the existing value that the intended net yearly cash flows.Internal price of return method – finds the interest yield of the potential investment.

Leave a answer Cancel reply

Your email deal with will no be published. Required areas are significant *


Name *

Email *


conserve my name, email, and website in this browser for the following time ns comment.

See more: Tekken Tag Tournament 2 Unlockable Characters, Tekken Tag Tournament 2

Are you searching for easy bookkeeping tutorial? Established since 2007, historicsweetsballroom.com hosts an ext than 1300 short articles (still growing), and also has aided millions accountancy student, teacher, junior accountants and small business owners, worldwide.