Budgeting and

Programming
Budgeting
 Budgeting
Purposes

• Forecasting and targeting tool

• Quantify performance indicators and define
accountabilities of the teams
• Communication of plan and coordination
• Basis for controlling costs and expenses
• Educate employees as to what the company wants to
accomplish
• Evaluate the enterprise by comparing actual results with
budgeted/target figures
 The Master Budget

Capital
Operating
Expenditure Cash Budget
Budget
Budget

Manpower Financial
Budget Budget
 The Master Budget
OPERATING BUDGET
REVENUE PRODUCTION GENERAL
ADMIN &
SELLING

CAPITAL EXPENDITURES INCOME STATEMENT

BUDGET
Sales
FIXED ASSETS Cost of Sales
MANPOWER
BUDGET Operating Expenses
PERMANENT WORKING Operating Profit
CAPITAL
Inventory Non-Operating Income
Accounts Receivable Non-Operating Expenses
R&D Taxes
Net Profit
CASH BUDGET

FUNDS FLOW
CASH POSITION
BALANCE SHEET STATEMENT
ASSETS LIABILITIES From Operating Activities
From Investment Activities
From Financing Activities
Capital Expenditure Budget

Additional fixed assets such as

plant, property, equipment
(land, building, machinery,
furniture, fixtures, vehicles),
permanent working capital
(inventory, accounts receivable
 Capital Expenditure Budget
Full Service Specialized Shop Roving
Mechanic

Tools ● ● ● ●
Machinery
(lithe, pressing
machine, etc.)
● ●
Equipment
(lifter,
compressor,
● ● ●
etc.)

Spare Parts ● ●
P100,000 to
Amount
P200,000
 Operating Budget

Expected revenues,
costs, expenses and
profits/losses
 Operating Budget

Revenue or •Total Job Order Cost + 15% to

Sales 50% Mark-Up

•Direct Costs such as labor,

Production parts

General, Admin •Shop expenses such as electricity,

and Selling water, rent, admin personnel
 Manpower Budget

Number of people needed, particular functions, compensation and benefits,

recruitment and training costs, separation and recycling costs
 Manpower Budget

Produc •Automotive Master Mechanic (above minimum

wage)
•Automotive Technician (minimum wage)

tion
•Automotive Machinist (minimum wage)
•Body Repairer (minimum wage)

General, •
Admin personnel
Admin and
Selling (minimum wage)
 Cash Budget

Expected cash receipts and disbursements (excess or shortfall in cash)

 Cash Budget
Capital
Expen •Fixed Ma •Automotive
ditures
Budget
Assets npo Master Mechanic
•Automotive

Opera
wer Technician
•Automotive
•Revenue Machinist
ting •Production
•General, Selling
Bud •Body Repairer
•Admin Personnel
Budge
t
and Admin get
 Financial Budget

Translation of all the budgets into the income statement, balance sheet, cash flow
statement and funds flow statement