Long-Term & Short-Term Budgetting Essay Example for Free

Long-Term Short-Term Budgetting Essay Introduction Budgeting is indeed a key component in managing short and long term planning. To define a broad objective such as wealth maximization is clearly not sufficient to achieve the goal. It is very important for an entity to get into more details over how to work towards the objective. Businesses typically do this by crafting a long-term plan and short-term plan which I will be explaining in details. Budgeting Before I proceed, it is very important for us to understand what is budget and how it works. A budget is a formal written summary (or statement of management’s plan for a specified future time period, expressed in financial terms. A budget becomes an important basis for controlling operations and evaluating performance. Thus, it promotes efficiency and serves as a deterrent to waste and inefficiency (Carlon, et al., 2009, p. 882) Types of budget There are several types of budget namely trade receivables budget, sales budget, finished inventories budget, trade payables budget, production budget, direct labour budget and many more. The list continues and varies from industry to industry. Budget usefulness Budgets are generally regarded as having four area of usefulness. * Budgeting promotes forward thinking and the possible identification of short-term problem. * They can also be used to help co-ordinate various sections of the business. * They play an integral role into motivating managers to perform better. * Providing basis for a system control, and lastly * Budgets can provide a system of authorization for managers to spend within the limit. (Merchant, Hawkins, Anthony, 2006, p. 560) The Planning process Figure 1 the planning process Source: (Banham, 2000, p. N.A) The above shows the relationship between budgets, long-term planning and short-term planning. The budgeting process The development of the budget for the coming year generally starts several months before the end of the current year. The budgeting process usually begins with the collection of data from each of the subunits of the entity. Past performance is often the starting point in budgeting, from which future budget goals are formulated. The budget is developed within a framework of a sales forecast that shows potential sales for the industry and the entities expected share of such sales. Sales forecasting involves a consideration of such factors as: I. General economic conditions. II. Industry trends III. Market research studies development IV. Anticipated advertising and promotion V. Previous market share VI. Changes in prices VII. New products VIII. Technology Short-term planning Short-term planning or budgeting is a process that focuses on short term, commonly one year, and results in the production of budgets that set the financial framework for that period. It is likely to be expressed mainly in financial terms and is designed to convert the long-term plan into an actionable blueprint for the future. The short-term planning is mainly carried out by Tactical managers and Operational managers. The budget will define precise targets for sales revenues and expenses, cash flows, short-term credit to be given or taken, inventory requirements, personnel requirements, increase profits, control costs, and invest for the future. Long-term Planning â€Å"Exercise aimed at formulating a long-term plan, to meet future needs estimated usually by extrapolation of present or known needs. It begins with the current status and charts out a path to the projected status, and generally includes short-term (operational or tactical plans) for achieving interim goals.† (Business Dictionary, n.d.) The above is a definition of Long-term planning or Strategic planning is usually carried out by senior management. The long-term plan covers a period of at least three years (some go up to five years) on a quarterly basis, forcing the organization into that discipline of thinking further out than one year. These plans should be updated when the short-range plan is prepared. Long-term strategies defines its overall effort in building market share, increasing revenues, decreasing costs, issues such as business take overs, expansion plans, deletion of business segments and radical product/service segment. (Budgeting, 2010) The way in which planning process is conducted depends on the industry and culture of the entity. Nevertheless, the entity outlines its long-term goals and specifies its short-range plans in quantifiable terms which detail how it expects to accomplish its goals (Hillstrom, 2013, p. 4) Long term planning Vs. Short-term planning Now that I put the definition and the functions of long term and short term planning before you. We will now see the advantages of long term and short term planning. * The main difference is the time period involved. The maximum length of a budget (or short term) is usually one year, and these budgets are prepared often for shorter period of time. In contrast, long-range planning usually encompasses a period of 3-5 years. * A second significant difference is the emphasis. Budgeting is concerned with the achievement of specific short-term goals. Long-range planning, on the other hand, is a formalized process of selecting strategies to achieve long-term goals and developing policies and plan to implement the strategies. Management is also responsible to respond to opportunities and challenges with strategic response that arise from anticipated trends in the economic and political environment. * Thirdly, there is difference between the details in the planning. Short term planning can be very detailed, this is to provide a basis for control. While long-rang plans contain considerably less details, because the data are intended for a review of progress towards long-term goals rather than for an evaluation of specific results to be achieved. The main objective of long-range planning is to develop the best strategy to maximize the entity’s performance over an extended future period. * Lastly, many entities today use a continuous 12-month budget by dropping the month just ended and adding a future month. One advantage of continuous short-term budgeting is that it keeps management planning a full year ahead, compared to just one-time planning for long term. Conclusion The preparation of budget is a valuable exercise as it forces management to look ahead and plan long term goal rather than to look back at the past. Once the long term goal has been set, a detailed short term planning can then be created. It is hence vital that budgeting is created as accurately as possible, as an error in data collection could affect the whole of the company’s operational and financial activities. The full benefits of budgeting can only be gained when the actual results are compared with the budgeted results then corrective actions are in place. Thus budgeting is a key component in managing short and long term planning. References Banham, R. (2000). Better Budgets. Journal of Accountancy, N.A. Budgeting. (2010). Retrieved from Entrepreneur: http://www.entrepreneur.com/encyclopedia/term/82266.html Business Dictionary. (n.d.). Retrieved from Defination of Long-term Planning: http://www.businessdictionary.com/definition/long-term-planning.html Carlon, S., Mladenovic-Mcalpine, R., Loftus, J., Palm, C., Kimmel, P. D., Kieso, D. E., Weygandt, J. J. (2009). Accounting building business skills. New York: John Wiley Sons. Hillstrom, E. K. (2013, Jan 27). Budgets and Budgeting.. Retrieved from Encyclopedia of Small Business.Vol. 1. Gale Cengage: http://www.enotes.com/budgeting-reference/ Merchant, K. A., Hawkins, D., Anthony, R. (2006). Accounting Text Cases. Australia: McGraw-Hill Education.

A Ph.D. in Industrial/Organizational Psychology Essay -- Graduate Admi

A Ph.D. in Industrial/Organizational Psychology    I intend to receive a Ph.D. in Industrial/Organizational psychology and I am interested in Central Michigan University because it offers applied practice through field experience and organizational internships. I have been told by many professionals that Central Michigan has excellent faculty and research facilities, as well as, provides a very thorough and effective foundation for work in the field. I intend to pursue a career in applied research and organizational consulting, therefore, these qualities are imperative to myself and my career.    Initially I plan to gain practical experience in the field through employment with a consulting firm. My long range objective is to acquire a teaching position with a college or university, while continuing research and consulting endeavors. It is my intention to contribute empirically based findings to the Industrial/Organizational psychology field through my research and practice. I also hope to be a strong influence and encouragement in students' lives through my contac...

The Invalid’s Story Notes

The Invalid's Story by Mark Twain a. k. a. Samuel Clemens (1835-1910) * Seems sixty and married * Really a 41 year old bachelor * two years ago he was â€Å"a man of iron, a very athlete† * Lost his health by helping take care of a box of guns on a two-hundred-mile journey by railway one night in winter * belongs in Cleveland, Ohio reached home after dark, in a snow-storm, and heard that his dearest boyhood friend and schoolmate, John B. Hackett, had died the day before * last utterance was a desire that I would take his body to his father and mother in Wisconsin * card marked â€Å"Deacon Levi Hackett, Bethlehem, Wisconsin† * long white-pine box fastened the card to it with tacks then put it aboard the express car then ran to the eating-room for a sandwich and some cigars * He came back and there was â€Å"a young fellow examining around it, with a card in his hands, and some tacks and a hammer† * a mistake was made and it turns out he was carrying off a box of guns which that young fellow had come to ship to a rifle company in Peoria, Illinois, and the young man had got John B. Hackett’s dead body * sat on a bale of buckets expressman – plain man of fifty, with a simple, honest, good-natured face, and a breezy, practical heartiness in his general style * package of peculiarly mature and capable Limburger cheese on one end of my coffin-box (box of guns) * at the time he had never heard of the cheese in my life and thus was ignorant of its character * â€Å"slammed his sliding doors to, and bolted them, closed his window down tight, and then went bustling around, here and there and yonder, setting things to rights, and all the time contentedly humming â€Å"Sweet By and By,† in a low tone, and flatting a good deal† * began to detect an odor on the frozen air every minute the odor thickened more and became more gamey and hard to stand * the expressman got some wood and made fire in his stove. * Thompson (the expre ssman) * felt himself growing pale and qualmish but said nothing. * â€Å"Pfew! I reckon it ain't no cinnamon ‘t I've loaded up thish-yer stove with! † * â€Å"Sometimes it's uncertain whether they're really gone or not,–seem gone, you know–body warm, joints limber–and so, although you think they're gone, you don't really know. I've had cases in my car. It's perfectly awful, becuz you don't know what minute they'll rise up and look at you! Then, after a pause, and slightly lifting his elbow toward the box, — â€Å"But he ain't in no trance! No, sir, I go bail for him! † * â€Å"Well-a-well, we've all got to go, they ain't no getting around it. Man that is born of woman is of few days and far between, as Scriptur' says. Yes, you look at it any way you want to, it's awful solemn and cur'us: they ain't nobody can get around it; all's got to go–just everybody, as you may say. One day you're hearty and strong and next day he's cut down like the grass, and the places which knowed him then knows him no more forever, as Scriptur' says.Yes'ndeedy, it's awful solemn and cur'us; but we've all got to go, one time or another; they ain't no getting around it. † * Had been dead 2 or 3 days * â€Å"Two or three years, you mean. † * They were heliotrope to him * Narrator suggested cigars * Thompson referred to the corpse by various titles, military ones, civil ones and as the stench grew, Thompson would give him a bigger title * Thompson said they should move the corpse about ten feet away * â€Å"we took in a good fresh breath at the broken pane, calculating to hold it till we got through; then we went there and bent over that deadly cheese and took a grip on the box.Thompson nodded â€Å"All ready,† and then we threw ourselves forward with all our might; but Thompson slipped, and slumped down with his nose on the cheese, and his breath got loose. He gagged and gasped, and floundered up and made a b reak for the door, pawing the air and saying hoarsely, â€Å"Don't hender me! –gimme the road! I'm a-dying; gimme the road! † Out on the cold platform I sat down and held his head a while, and he revived. * we hadn't budged the dead body * Thompson got carboy of carbolic acid from a station he drenched everything with it, rifle-box, cheese and all * the two perfumes began to mix and they had to leave the car * waltzed back and forth, freezing, and thawing, and stifling by turns * about an hour and they stopped at another station and Thompson came in with a bag * â€Å"He had brought a lot of chicken feathers, and dried apples, and leaf tobacco, and rags, and old shoes, and sulphur, and asafoetida, and one thing or another; and he, piled them on a breadth of sheet iron in the middle of the floor, and set fire to them. * the original smell stood up out of it just as sublime as ever * other smells just gave it a better hold * Thompson got suffocated and fell and before t he Narrator dragged Thompson out by the collar the Narrator was near gone * â€Å"Typhoid fever is what's going to come of this. † taken from the platform an hour later at the next station * Narrator went into a virulent fever, and knew nothing again for three weeks * He found out that he had spent that awful night with a box of rifles and cheese * the news was too late to save him because â€Å"imagination had done its work, and his health was permanently shattered† * Bermuda or any other land could bring his health back * His last trip because he is on his way home to die.

The Ethics Of The Nicomachean Ethics - 1356 Words

In one of his most popular works, Nicomachean Ethics, The ancient Greek philosopher, Aristotle, debates a variety of subjects in order to obtain a better understanding of virtue and what it means to be a virtuous character. One virtue that is extensively examined by Aristotle in book VII of the Nicomachean Ethics, is friendship. He debates that friendship is complete virtue and above justice and morality in which is why it should be so highly valued. His interpretation of friendship is abundantly deeper than one simple type or definition. Aristotle believes that there are three different kinds of friendship; that of utility, a pleasurable friendship, and a friendship of virtue. A friendship of utility is based on those who are useful to†¦show more content†¦While in Aristotle eyes, self-love of virtue is the utmost good an individual can obtain. Aristotle argues that one chooses to arrange relationships for their own personal gain, except for that of a virtuous friendship. Inside these types of friendship, there are basic conditions which are needed for any and all types of friendships. To attain these friendships or any kind of friendship, there are basic conditions which are needed in order to hold and maintain them. The basic conditions given by Aristotle is pleasure, providing need and goodwill for others. To attain any type of friendship an individual must be able to provide and receive enjoyment or pleasure from another individual and it will not last. The individual will only uphold the relationship until it is no longer pleasurable. These conditions for friendships generally result in short relationship seeing if it is for pleasure or if it is for a pair of individuals needing something from one another. Persons who maintain a friendship for a need will only maintain it until they achieve what is desired whether it be emotional or materialistic. In order for a friendship to exist, it needs to be made up of individuals who have the same degree of virtue and good will which results in a perfect friendship. In order for a perfect friendship to exist, individuals must be alike in their own personal good will and