. Develop an allocation and allotment plan. To complete this exercise, use the spreadsheet file on the CD entitled "Budget Tools chapter 08 exercises. On the tab labeled Erxercise in the spreedsheet is proposed budget for a health care finance program. From this, develop an allocation and an allotment plan. It is worth noting that the $400 million in object code 2241 is for health care claims, and the $10 million in 2501 is for claims-processing costs. The legislature has provided $50 million for new benefits but no money for the eastimated $50,000 in processing costs for new claims; these costs are to be achieved through administrative savings. The legislature has also demanded other administrative efficiencies. Little guidance has been given for achieving administrative efficiencies. Based on past patroll paterns, you may want to anticipate that 48 percent of the pay will occur in the first half of the year and 52 percent will be in the second half. There are no special purchases. The building lease for the departmental office is $125,000 per month. Net legislative adjustments are $48.75 million. 2. Examine and Discuss San Jone's Variance Report. In Table 8>3 we have used San Jone's operating budgets to create a hypothetical variance report. Find the variances for the expenditure side and discuss what you think might prove to be problematic for the agency in the coming months. 3. Examine and Discuss the Department of Transportation's Variance Report Table 8.4 is a hypothetical variance report from the department of transportation in a large city inthe Northeast. Find the variances for both the revenue and expenditure sides and discuss what you think will be problematic for the agency in the coming months.

Variance Analysis for San Jose Operating Budget, 2007-2008 Month One Annual Budget Actuals Budgeted Percent Spent Variance Expenditures 8.33% Fire $134,685,340 $11,000,000 $ $ Police $279,740,088 $23,500,000 $ $ - Double Click and enter your text answer here Percent Variance Month Three (Cumulative) Actuals Budgeted Percent Spent Variance Percent Variance 25.00% 0.00% 100.00% $32,500,000 $ $71,000,000 $ - $ $ - 0.00% 100.00% Variance Report from the Department of Transportation, 2007-2008 Month One Annual Budget Actuals Budgeted Percent Spent Variance Revenues 8.33% Federal aid $30,000,000.00 $2,000,000.00 $ $ State aid $80,000,000.00 $8,000,000.00 $ $ Local aid $20,000,000.00 $1,700,000.00 $ $ Total $130,000,000.00 $11,700,000.00 $ $ - 0.00% 0.00% 0.00% 0.00% $6,000,000.00 $30,000,000.00 $5,400,000.00 $41,400,000.00 $ $ $ $ - $ $ $ $ - 0.00% 0.00% 0.00% 0.00% Expenditures Central fleet Public works and transportation Public works department Snow removal Transportation depatment Total - 0.00% 0.00% 0.00% 0.00% $ 0.00% 0.00% $530,000.00 $390,000.00 $22,000,000.00 $2,100,000.00 $25,020,000.00 $ $ $ $ $ $ - $ $ $ $ $ $ - 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% Double Click and enter your text answer here $2,267,724.00 $1,606,402.00 $86,176,802.00 $12,292,072.00 $ $27,618,759.00 $129,961,759.00 $180,000.00 $130,000.00 $7,300,000.00 $2,300,000.00 $9,910,000.00 $ $ $ $ $ $ - $ $ $ $ $ $ Month Three (Cumulative) Actuals Budgeted Percent Spent Percent Variance Variance Percent Variance 25.00% Variance Analysis for San Jose Operating Budget, 2007-2008 Month One Annual Budget Actuals Budgeted Percent Spent Variance Expenditures 8.33% Fire $134,685,340 $11,000,000 $ $ Police $279,740,088 $23,500,000 $ $ - Double Click and enter your text answer here Percent Variance Month Three (Cumulative) Actuals Budgeted Percent Spent Variance Percent Variance 25.00% 0.00% 100.00% $32,500,000 $ $71,000,000 $ - $ $ - 0.00% 100.00% Variance Report from the Department of Transportation, 2007-2008 Month One Annual Budget Actuals Budgeted Percent Spent Variance Revenues 8.33% Federal aid $30,000,000.00 $2,000,000.00 $ $ State aid $80,000,000.00 $8,000,000.00 $ $ Local aid $20,000,000.00 $1,700,000.00 $ $ Total $130,000,000.00 $11,700,000.00 $ $ - 0.00% 0.00% 0.00% 0.00% $6,000,000.00 $30,000,000.00 $5,400,000.00 $41,400,000.00 $ $ $ $ - $ $ $ $ - 0.00% 0.00% 0.00% 0.00% Expenditures Central fleet Public works and transportation Public works department Snow removal Transportation depatment Total - 0.00% 0.00% 0.00% 0.00% $ 0.00% 0.00% $530,000.00 $390,000.00 $22,000,000.00 $2,100,000.00 $25,020,000.00 $ $ $ $ $ $ - $ $ $ $ $ $ - 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% Double Click and enter your text answer here $2,267,724.00 $1,606,402.00 $86,176,802.00 $12,292,072.00 $ $27,618,759.00 $129,961,759.00 $180,000.00 $130,000.00 $7,300,000.00 $2,300,000.00 $9,910,000.00 $ $ $ $ $ $ - $ $ $ $ $ $ Month Three (Cumulative) Actuals Budgeted Percent Spent Percent Variance Variance Percent Variance 25.00%