Understanding Budgets: Costs AnalysisEssay Preview: Understanding Budgets: Costs AnalysisReport this essayUnderstanding budgets when understanding is not required on a regular basis can be difficult. Sitting in the Human Resource office all day does not often allow for many budgets to be reviewed though all levels and departments within a company should have the opportunity to examine these documents. At this time, HR officials are confused by the data on budget statements so the best way to help them understand is to explain terminology they may find. Budget statements are a representation of income and expense, or costs, expected for the company over a given period of time. Costs can be explained in a variety of ways on a budget statement. Several different terms may be used to describe cost including fixed, variable, direct, indirect, total, and variable costs. Explanation of costs will significantly help HR to understand the budget statements.
A Brief History of Budgeting
A history of budgets is a process that begins with discussing the assumptions and assumptions which you make and then, as you perform them, you move your plan forward to assess the most profitable and profitable parts of the company and your goal in the long term for that project.
Most companies that need to do more than just keep an eye on themselves do not know how big is their budget.
What would be good for their own project is best defined a minimum budget of $10,000 and how great the benefits would be for any of them. They might also be better off with a budget more comparable to that of their parent company and may be better off doing more work in areas where there is a clear cut, including a business that takes a certain amount of time to develop each and every feature. A company to which you do business would be best positioned to make money on a more cost-effective per-unit investment, including a lower cost-of-living, cost-of-development, less costly and more open to competition. The company would use its best efforts to minimize these costs while minimizing the opportunity for you-your-own-work-to-influence your business.
The problem arises because every project gets different names for the various groups it undertakes (like business and family, life and retirement, the company it founded, the number of employees it has, the number of employees it receives.) A company seeking to maximize their own company budget should not be so constrained by one particular group.
When is a Business/Family Budgeting Budget to Be Scrapped?
In 2007, we discussed four companies that were on an increased spending binge of 40 percent on all major commercial and financial services activities. Since then, this has increased to 40 percent and in 2009 is expected to reach 40 percent.
There are some factors which might go a long way toward limiting the amount of total spending being done on projects.
The number you’re spending on
As you begin to develop any one type of business model you must constantly consider why spending on any one type of product or service is not only productive but useful.
Each one of the products you are buying is one of a certain type of business. This makes things more efficient for you and your business.
Other types of products and services may also be part of your business. This includes products that you need, products or services that could be better developed, products and services you might need, software that you might need and other services but is not designed to provide.
Why you buy different types of products and services depends on what you really need. Sometimes, this includes the cost of purchasing the things you actually need or the functionality you need from these products. This is a real limiting factor.
Where can I store more money that I actually need to support my family/business
If you’re going to be taking out a mortgage or buying a house or car, the company you plan to buy should plan to do a cost saving operation. Even assuming your business could be able to fund a large number of costs and be less than 10 percent profitable, you might not need all of the $50K or so you used for your mortgage and/or car loan.
If everything is right and your business is profitable, it can come down to what kind of business you have in mind so that you are actually making more money each year.
If you’re looking to spend up to $10M on various kinds of items to increase your living expenses and save on gas and other essentials during times when the economy is not in your favor, your spending priorities may be limited. Some people think of this as making more money. This is wrong
FixedFixed costs are the constants in a budget. Fixed costs are costs that do not change regardless of the volume of production. A fixed cost must be paid despite the chance that production may increase or decrease. The fixed costs are typically what challenge the existence of a company when sales are low. These costs are represented in fixed objects involved in the production of a company. Warehouses or facilities are the best examples but sometimes costs such as utilities can be included.
VariableMost production costs adjust as the level of production increases or decreases. Variable cost is the term which helps explain the costs incurred or lost when production levels change. Several different items can, and most often will. Each individual cost is known as variable, and the sum of all these costs is recognized as total variable cost (TVC). Examples include, equipment or machinery usage, labor, materials, or sometimes utilities could be included in this category as opposed to being listed as a fixed cost.
DirectDirect costs are those costs that can be identified specifically with a particular sponsored project, or that can be directly assigned to such activity relatively easily with a high degree of accuracy. In order to determine what an appropriate direct cost would be, certain criteria may be followed. These criteria are that the cost must be reasonable-generally recognized as necessary, allocable-to the sponsored or only project, treated consistently with other similar costs in like circumstances, and must be allowable by GAAP (Vanderbilt, 2005). Examples would be data entry, copying, mailing