Chapter 1 - Introduction to Budgeting
The Advantages of Budgeting
The Disadvantages of Budgeting
Capital Budgeting Problems
The Command and Control System
Chapter 2 - Cost-Volume-Profit Analysis
Contribution Margin
Contribution Margin Income Statement
Breakeven Point
Margin of Safety
Cost-Volume-Profit Analysis
Sales Mix
Chapter 3 - The System of Budgets
The System of Budgets
Operating Decisions Impacting the System of Budgets
The Reasons for Budget Iterations
The Number of Budget Scenarios
Chapter 4 - The Revenue Budget
Overview of the Revenue Budget
The Detailed Revenue Budget
Responsibility for Revenue Information
Sources of Revenue Information
The Impact of Pacing on the Revenue Budget
The Inherent Variability of the Revenue Budget
Chapter 5 - The Ending Finished Goods Inventory Budget
Ending Inventory Assumptions
Impact of Changes in Ending Inventory
The Ending Finished Goods Inventory Budget
Chapter 6 - The Production Budget
The Production Budget
Other Production Budget Issues
Budgeting for Multiple Products
Chapter 7 - The Direct Materials Budget
The Direct Materials Budget (Roll up Method)
The Direct Materials Budget (Historical Method)
The Direct Materials Budget (80/20 Method)
Anomalies in the Direct Materials Budget
The Role of the Direct Materials Budget
Chapter 8 - The Direct Labor Budget
The Direct Labor Budget (Traditional Method)
The Direct Labor Budget (Crewing Method)
The Direct Labor Budget for Manufacturing Cells
The Cost of Direct Labor
Anomalies in the Direct Labor Budget
Chapter 9 - The Manufacturing Overhead Budget
The Manufacturing Overhead Budget
Overhead Allocation between Periods
Additional Issues
Chapter 10 - The Cost of Goods Sold Budget
The Cost of Goods Sold Budget
Chapter 11 - The Sales and Marketing Budget
Types and Timing of Sales and Marketing Expenses
Structure of the Sales and Marketing Budget
Sources of Sales and Marketing Expense Information
Analysis of the Sales and Marketing Budget
Diminishing Returns Analysis
Sales and Marketing Pacing
The Impact of Bottlenecks on the Sales and Marketing Budget
Sales and Marketing Metrics
Chapter 12 - The Research and Development Budget
General Funding for Research and Development
Research and Development Funding Decisions
Expected Commercial Value
Project Risk
Project Selection Issues
The Project Failure Rate
Structure of the Research and Development Budget
Ongoing Project Analysis
Research and Development Measurements
Treatment of Cancelled Projects
Chapter 13 - The Administration Budget
The Administration Budget
Cost Variability in the Administration Budget
Allocation of Administration Expenses
Service-Based Costing
Chapter 14 - The Capital Budget
Overview of Capital Budgeting
Bottleneck Analysis
Net Present Value Analysis
The Payback Method
Capital Budget Proposal Analysis
The Outsourcing Decision
The Capital Budgeting Application Form
The Post Installation Review
The Lease versus Buy Decision
Capital Budgeting with Minimal Cash
Chapter 15 - The Compensation Budget
The Compensation Budget
The Treatment of Hourly Pay and Overtime
The Benefits Budget
The Headcount Budget
The Link between Budgets and Bonus Compensation
Chapter 16 - The Master Budget
The Budgeted Income Statement
Components of the Budgeted Balance Sheet
The Financing Budget
The Budgeted Balance Sheet
Accompanying Documentation
Chapter 17 - Flexible Budgeting
The Flexible Budget
The Flexible Budget Variance
Advantages of Flexible Budgeting
Disadvantages of Flexible Budgeting
Chapter 18 - Cost Variability
Mixed Costs
Labor-Based Fixed Costs
Costs Based on Purchase Quantities
Costs Based on Production Batch Sizing
Cost Based on Step Costs
Time-Based Costs
Experience-Based Costs
Incorporating Cost Variability into Reports
Chapter 19 - The Zero-Base Budget
Incremental Budgeting
Overview of Zero-Base Budgeting
The Zero-Base Budgeting Process
Advantages of Zero-Base Budgeting
Problems with Zero-Base Budgeting
Conditional Budgeting
Chapter 20 - Operating without a Budget
Alternatives to the Budget
Forecasting without a Budget
Capital Budgeting
Goal Setting without a Budget
Strategy without a Budget
Management Guidelines
The Role of Senior Management
Corporate Staff Roles
Board Approvals
Compensation without a Budget
Controls without a Budget
Behavioral Norms
Profit Knowledge
Information Exchange
Hiring, Promotions, and Continuity
Customer Ownership
Service Center Pricing
Accounting Reports
Transfer Pricing
Investor Relations
Implementation of the No-Budget Environment
Chapter 21 - The Rolling Forecast
The Rolling Forecast Process
The Rolling Forecast Format
Continuous Budgeting
Chapter 22 - Budgeting Procedures
Procedure Formulation of the Budget
Procedure Issue Budget Variance Reports
Procedure Subsequent Account Changes
Chapter 23 - Budgeting Efficiencies
Budget Model Efficiencies
Budgeting Process Efficiencies
Participative Budgeting
Chapter 24 - Budget Reporting
General Reporting Format
Revenue Reporting
Overview of Cost of Goods Sold Variance Reporting
The Purchase Price Variance
Material Yield Variance
Labor Rate Variance
Labor Efficiency Variance
Variable Overhead Spending Variance
Variable Overhead Efficiency Variance
Fixed Overhead Spending Variance
Problems with Variance Analysis
Which Variances to Report
How to Report Variances
Chapter 25 - Budgeting Controls
Budget Creation Controls
Budget Integration Controls
Appendix - Sample Budget
Glossary
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