Week 8 Assignment HSA 525
Budget Development
Overview
If your organization makes frequent business transactions, one of the tasks you face as a manager is budget preparation. A budget is a tool used for planning and controlling financial resources. It guides your future plan of action in financial terms within a set period of time. A budget does not have to be complex; however, it should support the organization’s strategic plan. We will need resources to achieve our goals and objectives.
For this assignment, you will focus on the operating budget. An operating budget shows the company’s projected revenue and associated expenses for an upcoming periodusually the next year. An operating budget starts with revenue and then shows each expense type. This includes variable costsor the costs that vary with salessuch as the cost of raw materials and production labor. The operating budget includes fixed costs, such as the monthly rent on office space or the monthly payment for a photocopier lease. The budget also includes operating expenses, such as interest on business loans, and the noncash expense of depreciation. These items enable the company to compute its projected net income and net profit percentage.
Instructions
Imagine you are the health care administrator for a nonprofit clinic, home health agency, or outpatient surgery center. Your first task is to locate the strategic plan for that organization or determine its strategic direction through the vision statement, mission or purpose statement, and strategic priorities or goals. You will also need the audited financial statements for the organization.
Using the information from your research, develop a one-year operating budget for the chosen entity, which will include operating revenues and expenses. Include a 1 page document to justify the approach you use in constructing the operating budget with the strategic plan or strategic direction.
Upload the strategic plan or strategic direction and audited financial statements as an attachment or include the Web link.
Complete your operating budget using Excel.
Support your work with at least three quality references, one being your course textbook. These should be cited per the Strayer Writing Standards.
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