The Grade only

Budget

Robert Shulzinsky

Southern New Hampshire University

June 8, 2018.

University day care center
Estimated annualized expenses for the next year.
Description	$
Revenue
Enrollee tuition fee	163214.9
Expenses
Salaries
Director	31990
Instructor	66500
Teacher	154108
Aides	27140
Clerical	9000
Subtotal	288738
Fringe benefits	54722
Supplies
Training	2190
Conference	904
Food	8762
Disposables	2300
Classroom suppliers	2629
Supplies subtotal	16785
Other expenses
Field trip	602
Equipment	548
Laundry	274
Contingency	2190
Maintenance	7119
Telephone	274
Rent	60,000
Other expenses subtotal	71007
Total expense	431252
Total revenue less expense	-268037.1

Analysis:

According to the assumptions, the budget for the next year is prepared in the above-mentioned table. For the coming year the revenues of the daycare are expected to increase by 15%, therefore their revenues increase from $141,926 to $163214.9. In the next year, two more teachers will join the day car as permanent teachers hence their salaries would be $40000 for both teachers. Therefore, the salaries from the previous year have increased from $114,108 to $154108. Due to increase in this total salary, the overall salary expense also increased from $248,738 to $288738. This addition to salary leads to increase in overall expense of daycare that is increased from $391,252 to $431252. Hence, we can say that there is a significant increase in expense from the previous year. The total revenues of this are -268037.1 that is greater than from last year. In the last year, the budget deficit was -$249,326. The budgeted revenues for both years are in deficit because no revenues are generated due to the high amount of expense. But in this year the deficit is greater than from the previous year.

Based on your analysis of the most recent profit and loss statement for the university day care center, compare the actual to budgeted revenues and expenses.

The budgeted revenues that were anticipated was $ 329194 but the revenues in actual were $ 141, 926 there is approximately 50% difference in the revenues that was budgeted and that was actual. The total salary expense was assumed $310200 while the actual salary expense was $248,738. The supplies expenses were presented in the budget was $30650 while in actual the supplies expense was $16785. Other expenses on the daycare were presented in the budget with an amount of $80,100 while the other expenses are $71,007. Compiling all the expenses that were calculated in the budget was $489,194 while in actual the total expenses that incurred was $391,252. The number of total revenues fewer expenses was ($160,000) while in actuality it is ($249,326). Hence, it shows that there is a great difference in budget and actual spending. There is a huge difference in actual spending and the amount of deficit shows that revenues that are presented in the budget were not based on reality.

Source

O'brien, M. (1979). The Toddler Center: A Practical Guide to Day Care for One-and Two-Year-Olds.The Toddler Center: A Practical Guide to Day Care for One-and Two-Year-Olds.