Category: Budget

Pointing to the survey we conducted, most airports lack an automated in-flight system. The proposed automated in-flight system will not only improve communication, but also efficiency in term of time and resources. Besides, it will not be a new technology that will require any special training. Rather, it is designed to improve on control of communication and ticketing while streamlining costs of operations.

We opine that the improved system will greatly improve the profits of this airport with new updated technological knowledge that is conscious of environmental conservation. Reflectively, the survey results indicated that the automated in-flight system will receive a warm reception among the customers who would want an improved version of the current system to an automated system to make their travel convenient.

To show the effect of the new system economically on the old ones cost, we made an assumption calculation table for the material budget used by the airport in Information Technology for 12 months. In calculating the unit cost of the old and new models we will apply the Conjoint Analysis (Curry 1996), which is a marketing research tool that is used to determine attributes of the new product and how the new features affect the price of the new product.

The choice to use conjoint analysis is supported by the fact that it is flexible and less expensive to carry out than concept testing (Trout 1998; Nagle & Holden 2001; Rhim & Cooper 2005). Suppose the company intended to purchase the new model, from the users perspective and experience, the new sets will be affected by some important product features, for example, speed, average life, and price. This strategy is applied when we want to get rid of overstock or sell complementary products. The products are bundled together and the customer who buys the new item can get an older or complimentary good for less (Day & Liam 1988; Doyle 2002).

Concerning the new model, we may decide to improve on the older versions or accessories that are compatible with the new model of the automated in-flight system in bundles at lower prices. Product bundling will help the airport to achieve its objective by making it possible to sell items that might have not been sold.

The first table below indicates the annual cost that the airport incurs in operating the old system as indicated in the survey results. We assumed that the system was operating fully within the budget set by the airport.

Table 1.

Table two below indicates the budget constraint for the new proposed system which has been adjusted to meet the demands and needs of potential buyers.

Table 2.

The main objective of this strategy is to attract and increase the market share of the product (Day & Liam 1988). Therefore, applying the costing strategy requires that the business reduces the prices to a certain minimum to attract customers; however, this price must be increased once the management is satisfied that the objective has been attained as this strategy initially reduces profit margins significantly. This costing strategy achieves the objective of quantity maximization by increasing the number of items sold at low prices. At the same, the strategy can help in revenue maximization that results from the large numbers of purchases made.

Indicate below is the saving that the airport will realize if they apply the new system as compared to the old system.

Marketing Cost

Besides this, the marketing cost will include 200 brochures and publicity complaints through social media costing AED 30 each. Besides, publicity through social media will cost an average of AED 3,000 per month for 12 months. The strategy will be able to generate more profit for the company by increasing the number of items sold, as well as increasing prices for customers who purchase one item. Practically, the strategy penalizes the customer for purchasing one item since the price is typically set higher than it will cost.

Profit Margin Calculation

Cost of New automated in-flight technology per client AED 491,568

Cost for Estimated 100 clients AED 49,156, 800

Marketing Cost (Social media + brochures) AED 40,000*100= AED 4,000,000

Profit AED 45,156,800.

References

Curry, J. (1996). Understanding conjoint analysis in 15 minutes: Quirks Marketing Research Review. New York: Sawtooth Technologies.

Day, G. S., & Liam, F. (1988). Valuing market strategies, Journal of Marketing, 2: 45-57.

Doyle, P. (2002). Marketing management strategy. Harlow: Prentice Hall.

Nagle, T., & Holden, R. (2001). The strategy and tactics of pricing. New York: Prentice-Hall, Upper Saddle River.

Rhim, H., & Cooper, L.G. (2005). Assessing potential threats to incumbent brands: new product positioning under price competition in a multi segmented markets, International Journal of Research in Marketing, 22 (2): 159-182.

Trout, J. (1998). Prices: simple guidelines to get them right, Journal of Business Strategy, 22: 13-16.

Introduction

The budget is a detailed plan on how to acquire and use finances among other resources over the production time stipulated (TM 9-2, 2010). Budget control plans established in the organization to help achieve set goals. It also helps to quantify an organization as a way of determining its financial feasibility. As a result, it helps in controlling costs, evaluating performances, and making future decisions.

Phonia Phelps Company is making a budget preparation for the semi-annual of the year ending 30 July. For the period, the company has budgeted follows.

Sales Budget in Dollars

The sales budget is a schedule showing sales expected for a given time in detail. It is a forecast of the companys sales to customers at a given time.

The companys selling price is $250 per case. Therefore, the sales budget preparations are as below.

Production Budget in Units

Extra Information

In order for Phionia Phelps to meet the next months expected growth, the companys desire is to maintain an inventory of 10% at the end of the month, which is equal to projected sales for the next month. Moreover, last year in December, the company had 500 (5000*10%) units on hand. With the above information, the production Budget is as below.
Production Budget=budget sales+ desired ending inventories  beginning inventories

Direct Materials Purchase in Pounds

Direct materials purchase budget expresses quantities and costs estimated for the raw materials and other components needed to meet the output demand of the production budget.

Extra Information

During production, all ingredient inventories for production are maintained at 5% of the next months production needs without exceeding 1,000 pounds for any ingredient.

Direct Materials Purchase in Dollars

Additional Materials

Direct Manufacturing Purchase Budget

Direct Manufacturing Labor Budget in Dollars

The manufacturing process requires labor to prepare ingredients at $18 and to cook and can the product at $24 per hour. In addition, the management of the firm is adjusting the workforce according to demands. Since processing one batch involves 1 hour and the batch produces 100 cases. Then, one case requires 0.01 hours.

Manufacturing Overhead Budget

Extra Information

Manufacturing overhead is fixed at $6,000 and $15 per case.

Business Viability

The production expense of the company in six months is $11,676. In case there is a $50,000 investment, the business plan remains viable since the production cost and total labor costs are low (TM 9-1, 2010). However, the direct purchase of raw materials is expensive than available cash. As a result, the business plan to be undertaken forces the investor to pursue other means of acquiring raw materials like credit (Accounting CPE, 2013).

Conclusion

The sales budget estimates the company sales. On the other hand, the production budget ensures the stock is maintained at economic levels. Direct material highlights the needed materials for optimum production, and labor budget shows the cost of optimum labor. Hence, these budgets can help to determine the feasibility of engaging in a certain business to reduce the chances of losses.

References

Accounting CPE (2013). Accounting Tools. Web.

TM 9-1 (2010). Agenda: Profile Planning (Budgeting).New York, NY: McGraw-Hill.

Budgeting for an anticipated income helps an individual to work within his or her pocket potential. The budget shown above is prepared by a nurse earning $50,000 annual gross income. The budget breakdown shows federal and state taxes charged at 12% and 3.34%, respectively, and other compulsory deductions relative to the annual income. The National Social security fund is charged at 6.2% to every employee to be paid back as a retirement benefit at the retirement age or as stipulated by the governing labor laws in America. To keep a healthy nation, the US provides universal health services that all employees pay to facilitate the scheme. Medicare fees are deducted from workers taxable income for universal health insurance to cover their families against medication. After federal and state taxes, social security, and Medicare, the worker takes home $25,191.70 to spend according to his household needs.

The worker pays annual rent and Mortgage interests of $10,200, IRA contributions of $1,000. School fees amounting to $1,500 are paid to respective schools where the children learn annually. The annual cost of food, clothing, commuting, lunches away from home amounts to $8,100. Out-of-home leisure and vocations will cost the worker $500 in the year 2020. The worker plans an annual saving of $2,082.70. The remaining figure ($809) will take care of any emergencies that the family will face during the year.

In conclusion, the budget is planned well for middle or low-income earners. The basic human needs are taken care of, and, above all, the worker is a responsible citizen carrying out their obligations as required by the federal labor laws. The worker has planned well for the childrens education, giving them the best medication, and planned for any eventualities that may come to interfere with the budget. Though the saving propensity lags, the budget seems great to project a better living standard in the future.

Reference

Salary pay-check calculator (2020). Web.

Budgeting is one of the most effective methods of organizing government activities. It helps decision-makers estimate and predict their expenditures and revenues to accomplish strategic tasks (Kasdin, 2017). To control adequate budget execution, various departments are demanded to submit performance reports monthly, quarterly, or annually. The former often implies that the administrative bodies are restricted to use one-twelfth of their yearly budget every month.

Some managers find such a system highly beneficial as it ensures equal cost distribution during a year, while others argue that this decision harms their departments performance due to inadequate match with the expenses. Thus, this essay seeks to discuss why certain departments support the usage of one-twelfth of their annual budget each month, and others oppose that strategy. Moreover, the paper argues that managers should consider the units actual performance to address the methods disadvantages.

Having budgetary control reports with each month representing one-twelfth of the overall budget further increases the ability to organize ones activity. Under such a system, managers enjoy constant expenditures each month, which protects their departments from spending all the resources unthoughtfully before the end of the year. Moreover, it motivates decision-makers to reduce expenditures as they cannot use additional resources for the operations from other months.

One of the government bodies that would enjoy this system is the Department of Health and Human Services. Contrary, such departments as the Ministry of Agriculture would be harmed from using one-twelfth of the annual budget each month due to seasonality, which means that their costs are distributed unequally throughout the year. Therefore, some months in the year would certainly be associated with unfavorable budget variances, which, for instance, can significantly affect the departments performance assessment. For this reason, decision-makers must identify each departments special activities and develop a system that would recognize seasonality and unequal distribution of the costs.

Overall, the current essay analyzed the current opposing views concerning the monthly restrictions to use one-twelfth of the annual budget. It was found that the difference in work specifics of various departments is the main reason determining the perception of the system mentioned above. The departments that have their expenditures equally distributed are prone to support it, whereas those who do not  hold opposing views. Therefore, it was argued that decision-makers should recognize these differences and adapt the budget usage accordingly.

Reference

Kasdin, S. (2017). An evaluation framework for budget reforms: A guide for assessing public budget systems and selecting budget process reforms. International Journal of Public Administration, 40(2), 150-163.

The implementation of the strategic plan of any organization always commences by determining the basic expectations of the management. These prospects often revolve around the future technological, economic, and competitive conditions of the business as well as their anticipated short-term and long-term effects. It is against this backdrop that many managers are keen on conducting situational analyses that entail examining both the strengths and weaknesses as well as opportunities and threats that competitors impose it is only after performing a SWOT analysis that an organization can accurately identify the potential strategies that it can leverage on to achieve its goals (Karim, 2019). The development of a budget is a significant step that a company uses to initiate its strategic plan.

An organization manager relies on responsibility centers drawn from their organizational structures for accountability. There are four known responsibility centers in an organization upon which decisions are made; cost center, revenue center, profit center, and investment center (Yagudina et al., 2017). An organization will manage to attain its strategic goals through an efficient budgeting system, which will, in turn, allow the manager to control key activities such as financing, revenue, and expenses.

However, to develop an effective budget that will inform key decision-making processes of the company, the manager has the option of applying various hypothetical figures. These data are drawn from the relationship between the actual cost and the standard cost. The actual cost (AQ) refers to the actual quantity of input applied in the production of output while the standard price (SP) and standard cost (SQ) are the standard price and quantity that the manager had anticipated.

Each productive input factor contains the variance analyses of labor, overhead, and material. Variance means the balance between the incurred actual cost and the standard cost appropriated for the production to be achieved. These hypothetical figures are significant for decision-making. By using the material price variance, a manager can expose the difference that exists between the materials purchased standard price and the actual amount paid for the very materials.

When it comes to determining the variance in materials quantity, the manager will compare his companys standard quantity of materials that ought to have been used to the quantity of materials that have been used. Thus, this underscores the significance of standard material quantity and actual material quantity variances in budgeting for decision making (Mubashar & Tariq, 2019). The manager will then measure this as the standard price per unit.

The variances of direct labor use similar logic as the direct material one. In determining the direct labor total variance, the manager will be obligated to compare the actual cost of labor to the cost of standard direct labor. The resulting labor variance could accrue from paying laborers rates that are either equal, below, or above the standard rates. It can also be a product of having the laborers work for the reduced amount of time than anticipated.

Therefore, a manager will rely on the labor rate variance to tell the difference between the actual rate and the standard rate for the actual number of hours that the laborers have worked. Decision-making regarding labor cannot be complete without considering the labor efficiency variance (Sekhar & Rajagopalan, 2012). With this, the manager will manage to effectively compare the direct labors standard hours that ought to have been used to the real hours that the laborers used. These figures are very significant when it comes to budgeting.

Decision-making involving actual profits from budgets can be achieved by company managers through comparative analysis of variations. It is not the sole responsibility of a companys CEO or general manager to drive up profits or incur losses for the organization. A unit head is just part of the team that comprises various employees, each of whom must play his or her roles effectively under the stewardship of a manager (Sekhar & Rajagopalan, 2012). Nonetheless, it is the responsibility of a unit manager to study the variances and establish if they are favorable or unfavorable towards sales, revenue, and production.

From a budget, a manager can comfortably tell which expenses are at par, less, or more than anticipated. This information is crucial for it informs whether to bar or increase production and act on sales accordingly. Besides, this information will also empower the manager with the right tools for determining which areas of responsibility need to be aligned further. Additionally, from a budget, a manager will get to pick some key factors that deviate it from the norm and isolate responsibility center variances. For instance, such budget items as revenue, salaries, marketing, maintenance, depreciation, and administration have their respective responsibilities.

In a mining firm, if the manager notices an adjustment in revenue from the budget, then he will know that there is something to do with the quality of the minerals, which affects sales. Therefore, the manager must contact his quality maintenance manager, civil engineer, geologist, marketing, and sales manager to find out where the problem is.

Budget deviation is primarily caused by changes in sales volume and production. A manager is, thus, fully aware that sales and production are key drivers that affect costs and revenue. This calls for the manager to budgets for various production levels. Such budgets are known as flexible budgets and are instrumental in helping a company manager to make effective decisions that will drive production and sales.

References

Karim, K. E. (2019). Advances in accounting behavioral research 21 / edited by Khondkar E. Karim (University of Massachusetts, Lowell, USA). Bingley Emerald Publishing.

Mubashar, A., & Tariq, Y. B. (2019). Capital budgeting decision-making practices: Evidence from Pakistan. Journal of Advances in Management Research, 16(2), 142-167. Web.

Sekhar, R. C., & Rajagopalan, A. V. (2012). Management accounting. New Delhi Oxford University Press.

Yagudina, R. I., Kulikov, A. U., Serpik, V. G., & Ugrekhelidze, D. T. (2017). Concept of combining cost-effectiveness analysis and budget impact analysis in health care decision-making. Value in Health Regional Issues, 13, 61-66. Web.

If business development forecasts are inaccurate and groundless, then this is an assumption. They can lead to loss of profits and investors. Therefore, it is essential to carefully prepare a business plan and calculate the factors of influence. This can be achieved by critically evaluating the project and making two different budget options depending on the global and national economy. It is also valuable to anticipate costs such as rent, utilities, and insurance. Since it is challenging to predict profits, it is possible to form an approximate budget due to general expenses. Moreover, companies can find data from similar businesses and compare them for more significant financial forecast accuracy (Williams and Calabrese 128). Consequently, there is a noble chance that the average will indicate costs and revenues in the budget.

Each business that wants to succeed in the competition must have a strategic development plan. For this purpose, a year or a few months in advance, the steps to achieve the set goals are defined, considering the available resources and market opportunities. Forecasting budgets allows for showing the balance between the desired and possible (Williams and Calabrese 145). With the help of budgets, an organization can exercise control over various factors that affect the final result. Moreover, constant monitoring of finances allows to quickly respond to changes in the situation and take measures.

However, today there is a question about the possibility of effective budget planning under conditions of uncertainty. The situation in the market is unstable, so it is difficult to evaluate and predict costs and revenues. Therefore, companies are forced to adapt budgeting for the next year in the new reality to reduce unnecessary effort and frustration not only in finances but also in business. First of all, they begin to use the concept of more flexible goals and focus on external indicators: market share, profitability, and competition (Williams and Calabrese 151). The budget volume is also being minimized, with short-term perspectives replacing long-term outlining. Evaluation of risks also plays a vital role in developing a strategy to quickly re-plan the budget according to the situation.

Work Cited

Williams, Daniel, and Thad Calabrese. The Status of Budget Forecasting. Journal of Public and Nonprofit Affairs, vol. 2, no. 2, 2016, pp. 127-160.

Introduction

After implementing the filing system, the hospital will need to control costs. The costs are controlled through the budgetary process. It will require various resources which will make it successful. The resources required include staff, computers, extra space, and maintenance. The space must be large enough to have an area for consultation, a waiting room, a pharmacy, wards, stores, and an open field for parking and for patients to rest while waiting for some medical attention. Resources always range from machines, drugs, human resources, ground, and finances. Without these resources, the hospital will be successful in delivering the services.

This requires a budget which is a quantitative expression of a plan of action and an aid to coordination and implementation. Budgets can be prepared or formulated for the organization as a whole or any sub-unit. They may include income, expenditure, and the employment of capital. Budgets can be designed to carry out a variety of functions such as planning, evaluating performance, coordinating activities, implementing plans, communicating, motivating, and authorizing actions.

Budgets are very important to the organization as they provide a discipline that brings planning to the forefront as a key management responsibility. In most cases, budgetary systems are more common in larger companies where formalized and sophisticated techniques are developed to serve the management. The major argument of budgeting maintains that the benefits from budgeting nearly always exceed the cost. Therefore budgeting programs are very important and helpful to almost every organization.

Specific strategies to manage budgets within forecasts of the hospital

Management by objectives

Under this strategy, the issue of coordinating the efforts of executives in achieving policy objectives have been highly stressed. A hospital that uses budgeting control faces human resistance. Employees can view budget control as a pressure device calculated to force them to attain impossible goals. As a result of this, managers who have been negatively implicated in the reports may not accept the adverse result. Therefore, there should be efforts to ensure that managers and supervisors appreciate the psychological implications of a budget.

Further, the problem of human resistance can be solved by the participation of all stakeholders in preparing budgets. The actual participation by top management in formulating budgets encourages them to play an active role in achieving corporate goals. The strategy ensures that each manager has responsibility for his objectives formulated with his immediate superior. For successful application of this strategy, it requires a hospital plan within which to operate. Further, a clearly defined hospital structure of management will enable, managers, to play their roles successfully.

In budgetary control, the accountant is required to produce information to help managers formulate objectives and present information to help the manager to assess his own performance.

Management by exception

Under this strategy, the important principle is that when a certain result has been achieved, a signal is given that a certain result is unacceptable promoting corrective action. Therefore once a budget has been formulated and agreed upon, there is no need to give detailed information of actual results to the managers. The managers responsibility is to control against a plan and, if the plan is achieved, they are successful.

If there is a variance between the actual and budgeted, there is a need to show where it has happened and why. The manager must focus his attention on problem areas and he does not want to shift through a mass of figures to find this. By reporting variance from the budget, the accountant guides the manager into problem areas, and so is the exception that the manager concentrates on to the exclusion of those items which fall within the budget (Berry, 2005).

Hospital and long-range planning

Sometimes, there is a tendency for budgetary control to operate where there is little or no attempt to specify long-term aims. As a result, budgets are based on an anticipated effect of past decisions and outside influences which have no link to the common objective to be achieved. The Hospital planning seeks to overcome this problem by determining the objectives of the business and developing plans designed to achieve the objectives (Shim & Siegel, 1998).

This strategy is very important as it is used to assess the strengths and weaknesses of the hospital in respect of matters of labor relations, ability to obtain capital, the competence of managers among them. The weaknesses must be overcome and strengares be exploited for the hospital to attain its objectives. Its from this assessment that specific plans will be developed to take the business from present performance. Examples of this planning are include strategic planning, operational and project planning (Shim & Siegel, 1998).

Expense Results With Budget Expectations, and Possible Reasons for Variance for the Hospital

First and foremost the latest technology shall be employed in the filing to promote efficiency and accuracy. Further employees will be assigned duties in their areas of specialization in order to promote efficient service delivery by the hospital.

To retain employees the hospital shall reward employees for good performance, organize social occasions for them, give them honours and introduce medical care plan for their families. Some incentives like overtime, bonuses, good working conditions, insurance covers, staff parties and transport allowances shall be given to employees.

Analysis of the variance

1. Salaries and wages- For the accounting period of 12 months, the sales actual cost decreased by $1000 from the budgeted cost. The variance is as the result of many improved filing system that reduced staff members.
2. Administration expense- During the 12 month period, the administration expense actual cost increased by $1200 from the budgeted cost. This variance was influenced by factors like; inflation and change in communication styles within the hospital. This expense includes office rent and rates, office lighting heating and cleaning, telephone, and postage and others. Most of the components of this expense are fixed in nature and therefore a smaller degree fluctuation
3. Drug cost for immunization -The actual costs of Drug cost for immunization increased by$1000 from the budgeted costs during the accounting period of 12 months. The variances arose because of service improvement and many children were brought to the hospital.
4. Child admission cost  the actual cost of admitting patients reduced from the budgeted cost due to the improved filing system. The time consumed while filing and
5. Insurance costs-the actual cost of insurance increased by $700 from the budgeted because of many reasons. This includes inflation, increased life expectancy rates and others

Benchmarking Techniques That Improve Budget Accuracy

As an effective aid to accurate forecasting of the hospital finances, it should be approached using some benchmarks. The possible benchmarks may inlude;

Sales staff procedure

In this case, those responsible should have an active role in budget formulation. Previous revenue collections are usually the base for predications. Proper scrutiny is done by hospital management on historical revenue behaviour and relates it to these data such as economic indicators and charging policies as well as out break of diseases. Current information is assembled based on the patents who visited the hospital in the previous year (Horngren, Datar, and Foster, 2003).

Statistical Approaches

Under this approach trend, cycle projection and correlation analysis are useful supplementary techniques. Correlation between revenue, outbreak of disease and economic indicators help make revenue forecasts more reliable, especially if fluctuating in certain economic indicators precede fluctuations in hospital sales. Too much reliance on statistical evidence is dangerous, because chance variations in statistical data may completely upset a program. This approach can provide help but not outright answers (Barsky and Catanach, 2004).

Group Executive Judgement

The top management may use their experience and knowledge to project revenue on the basis of group opinion. This approach brings responsibility to revenue predictions and ignores the need for tough-minded approach to this important task. The approach is fast and includes intricate statistical measures.

References

Berry, L. (2005). Management Accounting Demystified. New York: McGraw-Hill.

Barsky, N & Catanach, A. (2004). Management Accounting: A Business Planning Approach. Boston: South-Western College.

Horngren, C., Datar, S. & Foster, G. (2003). Cost accounting: a managerial emphasis. New Delhi: Prentice Hall.

Shim, J. & Siegel, J. (1998). Schaums Guideline of Managerial Accounting. New York: McGraw-Hill.

Nurse Manager Role in Budgeting: Budget Planning Process

Nurse managers set objectives and outline the budget (typically in association with the finance division) for their own duty center or nursing team. Next, when the budget has been established and efficiently restructured, it is given in to the management and, at last, to the Board of Directors for consent. When the budget is accepted and the fiscal year starts, the hospital has to deliver the premeditated services and plans (Rundio, 2012). Budget planning process consists of six steps  gathering appropriate data, scheduling services, scheduling activities, executing the plan, scrutinizing the budget, taking corrective actions when needed. Nurse managers take on some of the most serious functions in financial planning and the governing process. They act as the connection between the strategies of management and the performance of the organizations personnel. If they fail to reach the aims and objectives of the budget, the anticipated outcomes will not be achieved (Rundio, 2012).

Role of Nurse in Budgeting: Sources of Income

In healthcare, there are numerous sources of income that are relevant to the nurses. Most probably, one would primarily pay attention to the patient-related revenues. These incomes are mostly characterized by the direct payments that came from the patients or other organizations (E.g., insurance companies). The top sources of nursing revenue are grants, community visibility, unions, industry, healthcare students and staff, third-party payments, and professional companies. In the majority of the situations, nurse managers are responsible for the elaboration of the budget and in charge of assessing and generating the revenues (Rundio, 2012). Nursing managers constantly concentrate on the issues related to revenues. This is rather important because the incomes should be acceptable in order to cover the expenses (both expected and unexpected) related to the healthcare and services provided by the organizations staff. The money that is gained is used to recover the deficient funds for replacements and development.

The efficiency of a healthcare organization is usually assessed on the basis of the quality of its services and the profit that it makes throughout the fiscal year (Penner, 2013). Another key component of the nursing managers budget responsibilities is the tracking of payers and their involvement in the healthcare system. This is important because the revenues are typically projected by the payer types (Penner, 2013). The budget of the healthcare organization is recurrently affected by the following types of payers  direct payers (patients) and third-party payers (E.g., organizations that pay for their employees medical insurance) (Penner, 2013).

Role of Nurse Leader in Budgeting: Personnel Budget

When it comes to the major expenses comprised by the nursing budget, staff budget is the main expenditure in the nursing sector. In reality, wages regularly make up more than a half of clinic budgets. The staff budget limits the number of workers that is needed to constantly run the unit throughout the whole year (Bateman, 2012). The staff budget outlines the wage costs that will be remunerated. It represents the overtime hours, shift variances, positioning, working hours, bonuses and rewards, and salary rises. The employee budget contains genuine hours of work and the non-productive time. Non-productive time embraces the cost of profits, new worker training, staff turnover, holiday/ sick leaves, and briefings (Rundio, 2012).

Nurse Manager Role in Budgeting: Supply and Equipment Budget

Supply and equipment costs contain such day-to-day expenditures as the cost of electrical energy, maintenance, and therapeutic/ surgical provisions (tube feedings, catheters, syringes). The supplies in clinic comprise medications, medical goods, chemicals, disinfectants, food supplies, notepads and pencils, and uniform. The notion of equipment can be divided into two types  immovable and movable. Immovable equipment is not a structural part of the construction, but it is attached to the floors or walls. The movable equipment contains furniture and utensils.

References

Bateman, N. (2012). The business of nurse management: A toolkit for success. New York, NY: Springer.

Penner, S. J. (2013). Economics and financial management for nurses and nurse leaders (2nd ed.). New York, NY: Springer.

Rundio, A. (2012). The nurse managers guide to budgeting & finance. Indianapolis, IN: Sigma Theta Tau International.

Zero-based budgeting (ZBB) is a different approach to creating a budget. While most strategies for budgeting account for the history of previous transactions, ZBB does not operate on financial history and automatically included payments (Coyte et al., 2020). Therefore, each period in the budget is planned from a clean slate, and every department has to justify the necessary resources to receive them. According to previous studies of ZBB, this process has been shown to save money in every type of cost and bring positive results regardless of the organizations nature (Coyte et al., 2020). Moreover, even if the cost-effectiveness of this strategy does not improve much, ZBB also positively affects firms financial discipline and forces them to look at potentially inefficient parts of the business (Coyte et al., 2020). Thus, it can be argued that ZBB may bring a positive change to the federal budget process and should be implemented by Congress.

There exists some evidence supporting the use of ZBB in public organizations. Al-attara et al. (2020) demonstrate that the introduction of ZBB to government entities can be successful. The authors recommend implementing ZBB outside of the area under investigation and note the increased flexibility of their budget with the new strategy (Al-attara et al., 2020). Similarly, Ibrahim (2019) discusses using ZBB in public organizations and concludes that ZBB leads to better management decisions if the implementation process is planned well. Notably, in 2017, an act recommending the use of ZBB was introduced in the House of Representatives. Called Zero-based Budgeting Ensures Responsible Oversight (ZERO) Act of 2017, this bill suggested including the legal basis for each action in the federal budget (Library of Congress, 2017). It also proposed to describe the activity, alternative funding, priorities, and cost-effectiveness measures (Library of Congress, 2017). Therefore, one can see the potential for implementing this bill and moving toward ZBB to review the federal budgeting process.

References

Al-attara, H. A., Mashkourb, S. C., & Hassanc, M. G. (2020). Zero-based budget system and its active role in choosing the best alternative to rationalise government spending. International Journal of Innovation, Creativity and Change, 13(9), 244-265.

Coyte, R., Messner, M., & Zhou, S. (2020). The revival of zerobased budgeting: Drivers and consequences of firmlevel adoptions. Accounting & Finance. Web.

Ibrahim, M. M. (2019). Designing zero-based budgeting for public organizations. Problems and Perspectives in Management, 17(2), 323-333. Web.

Library of Congress. (2017). H.R.507  Zero-based Budgeting Ensures Responsible Oversight (ZERO) Act of 2017. Web.

In general, a citys budget may be defined as a plan of income and expenditures with an expected allocation of available resources among services, departments, and programs. As a small yet developing city, Exampleton requires an efficient distribution of existing revenues to contribute to its growth. The citys budget is reflected in Table 1, and according to it, police, community development, infrastructure, and engineering should be prioritized.

Table 1: Budget of Exampleton

Before the assessment of how the budget should be used, it is essential to evaluate the sources of revenue to define priorities. According to Exampletons budget, the citys main sources of revenue are property tax and sales tax. In this case, it is crucial to ensure the safety of citizens and businesses, along with the improvement of peoples general welfare, that may contribute to the citys growth and development as well. Thus, the main expenditures items should be police, community development, and street and engineering.

A safe and secure community should be prioritized  thus, safe neighborhoods should be maintained. In this case, 20% of the budget should be spent on a well-trained and equipped Police Department that should have a full capacity to prevent and efficiently manage criminal activities. At the same time, Exampleton should become a space for comfortable living  thus, 40% of the budget should be spent on community development, street infrastructure, and engineering. In particular, the quality of roads, the accessibility of public transport and public services, the construction of public facilities, and the creation of modern conveniences and hometown amenities for diverse population groups should be prioritized (U.S. Department of Housing and Urban Development, 2020). In addition, the safety of the location is determined by the response in the case of accidents  thus, the investments in the citys fire brigades should be considered as well.

To conclude, the distribution of Exampletons budget should ensure the safety of people and businesses along with the development of infrastructure and public facilities. In this case, the city will grow due to investments and immigration. Exampleton should become a safe and comfortable place for work and living, in which a modern though ecologically responsible community is established.

Reference

U.S. Department of Housing and Urban Development. (2020). Community development. U.S. Department of Housing and Urban Development. Web.