0
What else can I help you with?
Benefits of calculating budget variance?
Budgeted variance analysis is very helpful in controlling the cost and expenditure of products and also helpful in determining the variation in the production expenditure with budgeted expenditure and help to eliminate variances in future and make better budgets.
Is the budgeted income statement prepared before the sales budget?
Budgeted income statement is prepared at the last after preparing all other budgets and sales budget is the starting point of budgeting process.
What is the significance of sales budget in an enterprise?
Sales budget is the starting point of budgeting process because it provides the all important figure of budgeted sales data for production budgets and for all other budgeted financial statements.
How would you describe a financial budget?
Financial budgets identify sources and outflows of funds for the budgeted operations and the expected operating results for the period.
Are unfavorable variances credits or debits?
For most accounting entities in the United States, variances are neither debits nor credits, because variances are not recorded on the books of a business. A variance is simply the difference between what we expected the business to earn or spend and what it actually did earn or spend. Only the things that actually did happen are recorded on the books. But the amount we had expected to earn at the beginning of the year can be found in the budgets, forecasts or plans we created for the year when we set up budgets for the year. The difference between what we budgeted for and what actually happened is called the variance from budget. For example, if at the beginning of 2008, we projected that we would have total sales of $5 million dollars for the entire year, but twelve months later, we found that we had had only $4 million in sales in 2008, there is a variance of $1 million dollars, and it is unfavorable, because we actually had less sales revenue than we thought we would earn at the beginning of the year. But if our actual sales for 2008 totalled $6 million, the variance would still be $1 million, but it would be a favorable variance, because we made $1 million more in sales ($6 million) than we originally thought we would (5% million). If actual expenses are higher than the budgeted amount, the difference between the two amounts is an unfavorable variance, because we spent over budget, which reduces our profits. However, if actual expenses are lower than the budgeted amount, the difference is a favorable variance, because we were able to spend less than we thought we would have to, and our profits would be higher.
Which of the following modules is not located in the DTA Maintenance Tool?
Budgets
A major weakness of flexible budgets is?
they force the manager to compare actual costs at one level of activity to budgeted costs at a different level of activity.
What is the Difference between favourable and adverse variance?
At the start of fiscal period every organisation prepares budgets for the coming period and then use the same estimated budget at the end of fiscal year to evaluate the performence in the fiscal year. When actuall amount for any activity is utilized less then the budgeted amount estimated for the same activity at the start of the fiscal year and perform the same activity accurately as estimated at start of period with less amount then it is called favourable variance and vice versa.
If Stephen budgets of his money to spend on movies and music. Last month he spent of the budgeted amount. How much of his total budget did he spend on movies and music last month?
To determine how much of his total budget Stephen spent on movies and music, we need to know the specific fraction or percentage of the budgeted amount he spent. If, for example, he spent 75% of his budgeted amount, then he spent 75% of his total budget on movies and music last month. Without the exact figure, we cannot calculate the exact amount.
Detail of 'how will i make a budget' in tally erp9?
To create a Budget in Tally.ERP 9Go to Gateway of Tally > Accounts Info > Budgets > Create1. In the Budget Creation screen enter a Name for your budget.2. Select from the List of Budgets for Under field. You can have a hierarchical setup for budgets. In the List of Budgets, Primary is at the top of the hierarchy and you can create more primary budgets. Sub-budgets can be created under Primary budgets.3. Enter the period of the budget in the From and To fields. The period entered can be a month, a year or any other period.4. In Set/Alter Budgets of, select• Groups - To create a budget for a Group of ledger accounts.• Ledgers - To create a budget for Ledgers.• Cost Centres - To create a budget for Cost Centres.5. Accept to save.To create a Budget in Tally.ERP 9Go to Gateway of Tally > Accounts Info > Budgets > Create1. In the Budget Creation screen enter a Name for your budget.2. Select from the List of Budgets for Under field. You can have a hierarchical setup for budgets. In the List of Budgets, Primary is at the top of the hierarchy and you can create more primary budgets. Sub-budgets can be created under Primary budgets.3. Enter the period of the budget in the From and To fields. The period entered can be a month, a year or any other period.4. In Set/Alter Budgets of, select• Groups - To create a budget for a Group of ledger accounts.• Ledgers - To create a budget for Ledgers.• Cost Centres - To create a budget for Cost Centres.5. Accept to save.You can modify a budget, using the alter option.Go to Gateway of Tally > Accounts Info > Budgets > Alter1. In the Budget Alteration screen, modify the fields as required. Change the period or change budgets of Groups, Ledgers and Cost Centres.Note: By default, Set/Alter Budgets is set to No. Set this option to Yes to alter.Deleting a BudgetTo delete a budget: Go to Gateway of Tally > Accounts Info > Budgets > Alter· Press Alt+D. Creating Budget for GroupsIn the Budget Creation/Alteration screen, set Yes in the Groups field, to set budgets for a group or group of ledgers.In the Group Budget screen, select a Group from the List of Groups and enter Account Name.Enter the cost centre for a group in Cost Centres field, select Not Applicable, if the budget is not for a particular cost center.In Type of Budget, select from the following two types.1. On Nett TransactionsSelect this option to monitor the transaction amounts and not the balances. Nett is net of debits and credits for the specified period. Nett transactions Budgets specified for a period automatically gets apportioned over the period. i.e., When On Nett transactions Budgets are defined, the debit amount for the specified period after reducing the credits for the same period is considered without taking into account opening and closing balances. For example to compare transactions against budgets, especially revenue income and expenses On Nett Transactions can be selected. 2. On Closing BalanceSelect this option to monitor the balances of the Accounts and the not the transactions. i.e., each month will have the same budget value except that the actual Opening Balance is also taken into account. Budgets on Closing balances can be set for Bank Account Ledgers, Debtors Ledger balances and so on. For example to compare closing balance figures in final statements, especially Balance Sheet items like assets and liabilities, select Closing Balances. Enter the budget amount in the Amount field.Note : Group Budgets do not get apportioned whereas Ledger Budgets get apportioned for each month.In the Budget Creation/Alteration screen, set Yes in the Ledgers field, to set budgets for ledgers. Creating Budget for Ledger AccountsIn the Ledger Budget screen, select a Ledger from the List of Ledgers and enter Account Name.Budgets can also be defined for Cost Centres pertaining to Ledger Accounts wherein you can repeat the same ledger with another Cost Centre.Enter the cost centre for the Ledger Account in the Cost Centre field. Select Not Applicable if the budget is not for a particular cost centre, but for the company.In Type of Budget, select from the following two types.1. On Nett TransactionsSelect this option to monitor the transaction amounts and not the balances. Nett is net of debits and credits for the specified period. Nett transactions Budgets specified for a period automatically gets apportioned over the period. i.e., When On Nett transactions Budgets are defined, the debit amount for the specified period after reducing the credits for the same period is considered without taking into account opening and closing balances. For example to compare transactions against budgets, especially revenue income and expenses On Nett Transactions can be selected. 2. On Closing BalanceSelect this option to monitor the balances of the Accounts and the not the transactions. i.e., each month will have the same budget value except that the actual Opening Balance is also taken into account. Budgets on Closing balances can be set for Bank Account Ledgers, Debtors Ledger balances and so on. For example to compare closing balance figures in final statements, especially Balance Sheet items like assets and liabilities, select Closing Balances. Enter the budget amount in the Amount field.Note : Ledger Budgets get apportioned for each month. Creating Budgets for Cost CentresThe purpose of a budget is to control expenditure. You can create multiple budgets in Tally.ERP 9, each for a specific purpose such as for the Bank, for the Head Office, Marketing budgets, Finance budgets, and so on.1. In the Cost Centres field in the Budget Creation/Alteration screen, set Yes to set budgets for cost centres.2. In the Cost Centre Budget screen, select a Cost Centre from the List of Cost Centres and enter Cost Centre.3. Enter a budget figure in Expenses for the cost centre.4. Enter a budget figure in Income for the cost centre.5. Enter Closing Balance.6. Accept to save. Viewing Budget VarianceBudget Variance report can be viewed from Trial Balance, Group Summary, monthly summary etc. The Budget Variance button (Alt+B) is active, if Budgets feature is enabled and at least one budget created. Budget Variance displays Budgets, Actuals with percentage and Variance from the budget with percentage.1. Budget Variance can be accessed from:o Gateway of Tally > Display > Trial Balance to display the Trial Balance screen.o Gateway of Tally > Display > Account Books > Group Summaryand select a group from List of Groups to display the Group Summary screen.2. Click on Budget Variance (Alt+B) from the toolbar to display the Budget Analysis screen.3. Select from the List of Budgets for Budgets/Scenario.4. Three columns display Budget, Actuals and Budget Variance, respectively.Note : Use Column functionality to add/ remove columns for Multi-period or Multi-budget Comparative Variance report.Corporate budget Column displays the values of the Budget, which is defined.Actuals Column displays the value of Actual Expenditure incurred.Corporate Budget Variance displays the values of the Variance of the Actuals and Budgets. i.e., Budgets - Actuals = Variance .Note: If the Budget Variance shows the negative value, then the actual expenditure value has exceeded the Budgeted values.
How are statistics budgets revenue budgets and operating budgets related?
ask your brain
All budgets depend on the sales budget?
Yes, all budgets depend on sales budgets because budgets can't exceed the amount of available money. When sales are poor, the budgets will be smaller.
