Top of Form
Purpose of Assignment
The purpose of this assignment is to allow students to gain the necessary knowledge to effectively budget and to minimize the cumulative error between the projected values and actual values.
Note: The official term Income Statement is also known informally as Profit and Loss Statement.
Assignment Steps
1) Using your researched company from week one, construct an income statement from that company's current, given numbers (the actual column). Please have a revenue line and at least 5 expense line items -- below is a simplified example:
Bogus Company Income Statement ending Dec 31, 2017
Actual Budget Variance
Revenues
Expenses
Cost of Goods Sold
Salaries
Office Supplies
Utilities
Travel
Depreciation
Total Expenses
Net Income
2) then fill in budget numbers for each line item. I know that you do not have these items in your researched company so go ahead and create these numbers (for analysis purposes) -- be sure to create with at least a 10% difference in each line item -- some higher and some lower.
3) then calculate the variance column (actual - budget) this will be an over or under budget number.
4) then, create a 350-word paper analyzing and explaining the possible reasons each line item was over or under budget and what steps could be taken to rectify this for the next year. This is what should be happening in a real-world company -- except most mid to larger companies do this on a monthly basis -- it is known in some circles as a variance analysis.
Format assignment consistent with APA guidelines.
Cite a minimum of one peer reviewed reference from the University Library -- and do NOT forget to include your reference page and make sure all references are represented by citations in the body of the paper.
Click the Assignment Files tab to submit your assignment.
Bottom of Form
Use this space to build your submission.
You can add text, images, and files.
Add Content
Top of Form
Bottom of Form
Details & Information