budgeting assignment MGMT-8500
MGMT 8500 BUDGET ASSIGNMENT-521 Contents Overview Grading Related textbook content: Background: Budget for the year 2020 Revenue Direct Labour expense Cleaning supply usage Cleaning supply expense Fixed overhead Receptionist Depreciation Gas: Office Supplies Actual results for the year 2020 Revenue: Commercial Residential Direct Labour expense Cleaning supply usage Cleaning supply expense Fixed overhead Receptionist Depreciation Gas: Office Supplies Unproductive unbilled) factor Required: Part A Other guidelines. Part : Deliverables: 7 7 7 7 10 1P MCurro BUDGET ASSIGNMENT-521 10 Delivery Marking Key and Rubric 10 MGMT 8500 BIOGET ASSORN Overview: In this assignment, you are provided with a case which includes data relating to static budget, flexible budget and variance analysis. You will transcribe the data from the case and create: Static budget Actual budget Flexible budget Static budget variance Flexible budget variance Variance analysis You will also write a memo regarding ethical conduct during budget preparation and how building in slack' represents unethical behaviour Grading: This is an individual assignment worth 20% of your final grade Related textbook content: The content you are being assessed on appears in Chapter 7 and Chapter 11 of the textbook. This content is covered in class during weeks 9.10 and IL 31 Pace MGMT SOD BUDGET ASSIGEN-523 CASE MGMT 8500 BUDGET ASSIGNMENT-521 CASE Background: Super Clean is a local business in the Tn cities area. It provides cleaning services to residential households and commercial establishments. Both households and businesses sign contracts with Super Clean. As the contractor, Super Clean dispatches its crew to the locations. The crew performs the cleaning as per the contracts and reports back to the company main desk. The main desk then prepares the invoice and sends them to the clients. Clients have one day to pay the invoice, Sales volume can vary from one quarter to the next In terms of expenses, the main expense for Super Clean relates to labour. They pay crew members competitive wages and benefits. The wage rate is calculated on an hourly basis and is fixed for the entire year The next expense item is cleaning supplies. Super Clean accounts for cleaning supplies relative to the hours worked. For example, they estimate that cleaning supplies are consumed at a rate of 0.2 litres per labour hour. This is a good measure because the longer it takes for a site to be cleaned, the more the consumption of cleaning supplles. Cleaning supplies are procured from a prominent vendor and the cost is fixed for the entire year Sometimes clients are not happy about the cleaning services and register a complaint. In that case, the crew is dispatched again for a second cleaning. The hours accruing from such scenarios are not billed to the clean as this constitutes a service recovery. However, the crew is paid for such hours. Super Clean maintains a record of these hours and classifies them as 'unproductive hours' or 'unbilled hours. This is calculated as a percentage of revenue eaming hours leg 10% of revenue generating hours). For the purpose of this assignment, assume that there is no consumption of cleaning materials when this second cleaning is being done 41 Pate MGMT SRO BUDGET ASSIGNMENT - 523 Budget for the year 2020: The budget for the year 2020 was prepared in December 2019 and had the following components MGMT 5500 BUDGET ASSIGNMENT-521 Budget for the year 2020: The budget for the year 2020 was prepared in December 2013 and had the following components: Revenue The revenue is calculated as number of hours that the crew works on a site, multiplied by the contracted rate with the client. The hours worked in the residential and commercial segments are shown separately, and there is a total for the combined hours worked. The revenue for each segment is arrived at by multiplying the hours for the segment by the rate. The budget is prepared for four quarters, one to four For the first quarter of 2020, the budgeted sales hours and hourly revenue wete: Item Budgeted sales commercial, in hours 2800 Budgeted sales residential in hours Budgeted selling rate commercial), per hour Budgeted selling rate (residential, per how 551 1200 $40 For quarters two, three and four it was projected that: Budgeted sales in hours for both commercial and residential will increase at the rate of 5% on a quarter over quarter basis Budgeted selling rate will increase at 3% on 2 quarter over quarter basis for the commercial segment, and 5% on a quarter over quarter basis for the residential segment. Direct Labour expenses Super Clean will pay its employees an hourly rate of $ 21 for the entire year. Cleaning supply usage: The budgeted usage is 0.2 litre/abour hour for the commercial segment and 0.1 litre/ labour hour for the residential segment. This is constant for the entire year. 5 Pare MGMT 500 BUDGET ASSIGNMENT-521 Cleaning supply expense Budgeted expense is $5 per liter for the entire year. Fixed overhead To support the cleaning operations, there are four items of expenditure. These are designated as MGMT SO BUDGET ASSIGNMENT-521 Cleaning supply expense Budgeted expense n 55 per liter for the entire year. Fixed overhead: To support the cleaning operations, there are four items of expenditure. These are designated as overheads and their budgeted expenses are as follows: Receptionist Budgeted expense is $ 6 000 per quarter and is the same for all four quarters Depreciation This relates to the depreciation of vehicles used to transport employees to client locations Budgeted expense is $ 9 000 per quarter and is the same for all four quarters. Gas: Budgeted expenditure on gas is $ 7000 and is the same for all four quarters Office Supplies Budgeted expenditure on Office Supplies is $ 1000 per quarter and is the same for all four quarters Actual results for the year 2020. it is now January 7, 2021 and Super Clean is comparing the actual expenses against their budget. Here is what they found Revenue For the first quarter of 2020, the actual sales hours and hourly revenue were: Item 2660 1140 Actual sales (commercial, in hours Actual sales residential, in hours Actual selling rate (commercial per hour Actual selling rate (residential, per hour $ 45 $ SO MGMT 3500 BUDGET ASSIGNMENT-521 For quarters two, three and four it was noticed that Commercial Actual sales recorded a 5% increase in Q2 over Q1Q3 was 3% higher than 02.04 was 2% MGMT 500 BUDGET ASSIGNMENT-991 For quarters two, three and four it was noticed that: Commercial Actual sales recorded a 5% increase in 2 over 13 was higher than 0.20was 2x higher than Hesidential . Actual sales recorded as increase in Q2 over 01. 03 was higher than 02 04 was 2x higher than 03 Direct Labour expense Super Clean paid its employees an hourly rate of $ 19 Sot the entire year Cleaning supply usage The actual usage was 0.18 litre / labout hour for the commercial segment and 0.09 litre/ tabour hout for the residential segment. This was constant for the entire year. Cleaning supply expense: Actual expense was $5.50 per liter for the entire year. Fixed overhead To support the cleaning operations, there are four items of expenditure. These we designated as overheads and their budgeted expenses are as follows: Receptionist Actual expense was $6 200 per quarter and is the same for all fout quarters Depreciation This relates to the depreciation of vehicles used to transport employees to cient locations. Actual expense was $9 200 per quarter and was the same for all four quarters Gas Actual expenditure on gas was $ 7100 and was the same for all four quarters Office Supplies Actual expenditure on Office Supplies was $ 1.100 per quarter and was the same for all tour quarters 71 Pate MGMT 8500 BUDOET ASSIGNMENT-521 Unproductive (unbilled) factor Cleaning crews had to work 5% over the revenue generating hours to attend to complaints and do second cleaning. These hours were not billable to clients, but Super Clean would pay the employees for MGMT 8500 BLOGET ASSIGNMENT-523 Unproductive (unbilled) factor Cleaning crews had to work 5% over the revenue generating hours to attend to complaints and do a second cleaning. These hours were not bilable to clients, but Super Clean would pay the employees for this time they worked. For the purpose of this assignment, assume that there is no consumption of cleaning materials when this second cleaning was done Required: Part A For this part you will use the template provided in Excel Workbook format. Complete the following steps in sequence: Step One Spreadsheet title Input Database TWO Input Database Three Static Budget Four Actual Budget Activity Populate the section 44:624 with data from the above case and develop the budget parameters Populate the section K435 with data from the above case and develop the actual parameters Populate the section A7 F29 with data from the spreadsheet Input Database and develop the static budget Populate the section A7:F29 with data from the spreadsheet"input Database and develop the actual budget Populate the section A7 F29 with data from the spreadsheet"Input Database and develop the flexible budet Populate section AS E 26 W. data from the spreadsheets Static Budget' and 'Actual Budget and develop the static budget variance. Five Flexible Budget Sex Var Analysis Static and Flex Poze MGMT 500 BUDGET ASUGNMENT- Seven Var Analysis - Static and Populate the section G5:26 with data from the Flex spreadsheet Actual Budget' and 'Flexible Budget' and develop the flexible budget variance Material variances Using applicable data complete the analysis of Material variances for both the commercial and Eight MGMT SO BUDGET ASSIGNMENT- Seven Eight Var Analysis --Static and Populate the section 5:126 with data from the Flex spreadsheet "Actual Budget and Flexible Budget and develop the flexible budget variance. Material variances Using applicable data complete the analysis of Material variances for both the commercial and residential agents Labour variances Using applicable data complete the analysis of Material variance for both the commercial and Nine Other guidelines Data should be entered in the input Database spreadsheet only . For all other spreadsheets, you must use cell references, linking data from 'Input Database' or Other spreadsheets. Do not enter data or calculations without cell references To calculate variances, you need to use formula Part 8 In week &, your Professor will be discussing about ethical practices during budget preparation. One such practice involves use of budgetary Black Reflecting on this learning experience, you wil write amemo to the CEO of SUPER CLEAN The CEO is concerned regarding ethical practices and needs your advice. In your role as a consultant, write a memo explaining What budgetary slack? Possible budgetary items where budgetary suck can be applied If you comider budgetary stack as ethical or unethical? Structure of the memo Word limit: 300 words main Arial or Calibri font Memo format As MS Word document Memo will be verified through Tun. 91 MGMT WUOGET ALONENTS Deliverables: Completed Excel workbook Memo in MS Word format MGMT 8500 BUDGET ASSIGNMENT-521 Deliverables: Completed Excel workbook Memo in MS Word format Delivery: Upload both the items to the assigned folder in eConestoga Your Professor will advise you as to the due date of this assignment Marking Key and Rubric: Included within the Excel workbook, Please review all items in the marking key before submission and ensure they are complete 10 Page MGMT 8500 BUDGET ASSIGNMENT-521 Contents Overview Grading Related textbook content: Background: Budget for the year 2020 Revenue Direct Labour expense Cleaning supply usage Cleaning supply expense Fixed overhead Receptionist Depreciation Gas: Office Supplies Actual results for the year 2020 Revenue: Commercial Residential Direct Labour expense Cleaning supply usage Cleaning supply expense Fixed overhead Receptionist Depreciation Gas: Office Supplies Unproductive unbilled) factor Required: Part A Other guidelines. Part : Deliverables: 7 7 7 7 10 1P MCurro BUDGET ASSIGNMENT-521 10 Delivery Marking Key and Rubric 10 MGMT 8500 BIOGET ASSORN Overview: In this assignment, you are provided with a case which includes data relating to static budget, flexible budget and variance analysis. You will transcribe the data from the case and create: Static budget Actual budget Flexible budget Static budget variance Flexible budget variance Variance analysis You will also write a memo regarding ethical conduct during budget preparation and how building in slack' represents unethical behaviour Grading: This is an individual assignment worth 20% of your final grade Related textbook content: The content you are being assessed on appears in Chapter 7 and Chapter 11 of the textbook. This content is covered in class during weeks 9.10 and IL 31 Pace MGMT SOD BUDGET ASSIGEN-523 CASE MGMT 8500 BUDGET ASSIGNMENT-521 CASE Background: Super Clean is a local business in the Tn cities area. It provides cleaning services to residential households and commercial establishments. Both households and businesses sign contracts with Super Clean. As the contractor, Super Clean dispatches its crew to the locations. The crew performs the cleaning as per the contracts and reports back to the company main desk. The main desk then prepares the invoice and sends them to the clients. Clients have one day to pay the invoice, Sales volume can vary from one quarter to the next In terms of expenses, the main expense for Super Clean relates to labour. They pay crew members competitive wages and benefits. The wage rate is calculated on an hourly basis and is fixed for the entire year The next expense item is cleaning supplies. Super Clean accounts for cleaning supplies relative to the hours worked. For example, they estimate that cleaning supplies are consumed at a rate of 0.2 litres per labour hour. This is a good measure because the longer it takes for a site to be cleaned, the more the consumption of cleaning supplles. Cleaning supplies are procured from a prominent vendor and the cost is fixed for the entire year Sometimes clients are not happy about the cleaning services and register a complaint. In that case, the crew is dispatched again for a second cleaning. The hours accruing from such scenarios are not billed to the clean as this constitutes a service recovery. However, the crew is paid for such hours. Super Clean maintains a record of these hours and classifies them as 'unproductive hours' or 'unbilled hours. This is calculated as a percentage of revenue eaming hours leg 10% of revenue generating hours). For the purpose of this assignment, assume that there is no consumption of cleaning materials when this second cleaning is being done 41 Pate MGMT SRO BUDGET ASSIGNMENT - 523 Budget for the year 2020: The budget for the year 2020 was prepared in December 2019 and had the following components MGMT 5500 BUDGET ASSIGNMENT-521 Budget for the year 2020: The budget for the year 2020 was prepared in December 2013 and had the following components: Revenue The revenue is calculated as number of hours that the crew works on a site, multiplied by the contracted rate with the client. The hours worked in the residential and commercial segments are shown separately, and there is a total for the combined hours worked. The revenue for each segment is arrived at by multiplying the hours for the segment by the rate. The budget is prepared for four quarters, one to four For the first quarter of 2020, the budgeted sales hours and hourly revenue wete: Item Budgeted sales commercial, in hours 2800 Budgeted sales residential in hours Budgeted selling rate commercial), per hour Budgeted selling rate (residential, per how 551 1200 $40 For quarters two, three and four it was projected that: Budgeted sales in hours for both commercial and residential will increase at the rate of 5% on a quarter over quarter basis Budgeted selling rate will increase at 3% on 2 quarter over quarter basis for the commercial segment, and 5% on a quarter over quarter basis for the residential segment. Direct Labour expenses Super Clean will pay its employees an hourly rate of $ 21 for the entire year. Cleaning supply usage: The budgeted usage is 0.2 litre/abour hour for the commercial segment and 0.1 litre/ labour hour for the residential segment. This is constant for the entire year. 5 Pare MGMT 500 BUDGET ASSIGNMENT-521 Cleaning supply expense Budgeted expense is $5 per liter for the entire year. Fixed overhead To support the cleaning operations, there are four items of expenditure. These are designated as MGMT SO BUDGET ASSIGNMENT-521 Cleaning supply expense Budgeted expense n 55 per liter for the entire year. Fixed overhead: To support the cleaning operations, there are four items of expenditure. These are designated as overheads and their budgeted expenses are as follows: Receptionist Budgeted expense is $ 6 000 per quarter and is the same for all four quarters Depreciation This relates to the depreciation of vehicles used to transport employees to client locations Budgeted expense is $ 9 000 per quarter and is the same for all four quarters. Gas: Budgeted expenditure on gas is $ 7000 and is the same for all four quarters Office Supplies Budgeted expenditure on Office Supplies is $ 1000 per quarter and is the same for all four quarters Actual results for the year 2020. it is now January 7, 2021 and Super Clean is comparing the actual expenses against their budget. Here is what they found Revenue For the first quarter of 2020, the actual sales hours and hourly revenue were: Item 2660 1140 Actual sales (commercial, in hours Actual sales residential, in hours Actual selling rate (commercial per hour Actual selling rate (residential, per hour $ 45 $ SO MGMT 3500 BUDGET ASSIGNMENT-521 For quarters two, three and four it was noticed that Commercial Actual sales recorded a 5% increase in Q2 over Q1Q3 was 3% higher than 02.04 was 2% MGMT 500 BUDGET ASSIGNMENT-991 For quarters two, three and four it was noticed that: Commercial Actual sales recorded a 5% increase in 2 over 13 was higher than 0.20was 2x higher than Hesidential . Actual sales recorded as increase in Q2 over 01. 03 was higher than 02 04 was 2x higher than 03 Direct Labour expense Super Clean paid its employees an hourly rate of $ 19 Sot the entire year Cleaning supply usage The actual usage was 0.18 litre / labout hour for the commercial segment and 0.09 litre/ tabour hout for the residential segment. This was constant for the entire year. Cleaning supply expense: Actual expense was $5.50 per liter for the entire year. Fixed overhead To support the cleaning operations, there are four items of expenditure. These we designated as overheads and their budgeted expenses are as follows: Receptionist Actual expense was $6 200 per quarter and is the same for all fout quarters Depreciation This relates to the depreciation of vehicles used to transport employees to cient locations. Actual expense was $9 200 per quarter and was the same for all four quarters Gas Actual expenditure on gas was $ 7100 and was the same for all four quarters Office Supplies Actual expenditure on Office Supplies was $ 1.100 per quarter and was the same for all tour quarters 71 Pate MGMT 8500 BUDOET ASSIGNMENT-521 Unproductive (unbilled) factor Cleaning crews had to work 5% over the revenue generating hours to attend to complaints and do second cleaning. These hours were not billable to clients, but Super Clean would pay the employees for MGMT 8500 BLOGET ASSIGNMENT-523 Unproductive (unbilled) factor Cleaning crews had to work 5% over the revenue generating hours to attend to complaints and do a second cleaning. These hours were not bilable to clients, but Super Clean would pay the employees for this time they worked. For the purpose of this assignment, assume that there is no consumption of cleaning materials when this second cleaning was done Required: Part A For this part you will use the template provided in Excel Workbook format. Complete the following steps in sequence: Step One Spreadsheet title Input Database TWO Input Database Three Static Budget Four Actual Budget Activity Populate the section 44:624 with data from the above case and develop the budget parameters Populate the section K435 with data from the above case and develop the actual parameters Populate the section A7 F29 with data from the spreadsheet Input Database and develop the static budget Populate the section A7:F29 with data from the spreadsheet"input Database and develop the actual budget Populate the section A7 F29 with data from the spreadsheet"Input Database and develop the flexible budet Populate section AS E 26 W. data from the spreadsheets Static Budget' and 'Actual Budget and develop the static budget variance. Five Flexible Budget Sex Var Analysis Static and Flex Poze MGMT 500 BUDGET ASUGNMENT- Seven Var Analysis - Static and Populate the section G5:26 with data from the Flex spreadsheet Actual Budget' and 'Flexible Budget' and develop the flexible budget variance Material variances Using applicable data complete the analysis of Material variances for both the commercial and Eight MGMT SO BUDGET ASSIGNMENT- Seven Eight Var Analysis --Static and Populate the section 5:126 with data from the Flex spreadsheet "Actual Budget and Flexible Budget and develop the flexible budget variance. Material variances Using applicable data complete the analysis of Material variances for both the commercial and residential agents Labour variances Using applicable data complete the analysis of Material variance for both the commercial and Nine Other guidelines Data should be entered in the input Database spreadsheet only . For all other spreadsheets, you must use cell references, linking data from 'Input Database' or Other spreadsheets. Do not enter data or calculations without cell references To calculate variances, you need to use formula Part 8 In week &, your Professor will be discussing about ethical practices during budget preparation. One such practice involves use of budgetary Black Reflecting on this learning experience, you wil write amemo to the CEO of SUPER CLEAN The CEO is concerned regarding ethical practices and needs your advice. In your role as a consultant, write a memo explaining What budgetary slack? Possible budgetary items where budgetary suck can be applied If you comider budgetary stack as ethical or unethical? Structure of the memo Word limit: 300 words main Arial or Calibri font Memo format As MS Word document Memo will be verified through Tun. 91 MGMT WUOGET ALONENTS Deliverables: Completed Excel workbook Memo in MS Word format MGMT 8500 BUDGET ASSIGNMENT-521 Deliverables: Completed Excel workbook Memo in MS Word format Delivery: Upload both the items to the assigned folder in eConestoga Your Professor will advise you as to the due date of this assignment Marking Key and Rubric: Included within the Excel workbook, Please review all items in the marking key before submission and ensure they are complete 10 Page
