Upon successful completion of this course, participants will be able to:

Chapter 1

• Identify the purpose of budgeting, citing advantages and disadvantages
• Specify the areas within an organization where there is a bureaucracy supporting the use of budgeting

Chapter 2

• Identify the components of cost-volume-profit analysis, noting the relationship between costs, unit volumes, and profitability as well as ways that this type of analysis can be used
• Determine the number of units sold as well as the sales mix variance given a set of circumstances

Chapter 3

• Identify the types of budgets that are included in the system of budgets, noting key elements as well as their intended purpose
• Recognize the operating decisions that can impact the system of budgets as well as reasons for budget iterations

Chapter 4

• Recognize the possible formats for the revenue budget, noting who is responsible for this type of budget, how it is used, and potential reporting issues
• Cite sources of information for the revenue budget, the impact of pacing, and the inherent variability of this type of budget

Chapter 5

• Identify the components of the ending finished goods inventory budget, noting the impact of different decisions on the amount of finished goods inventory on hand

Chapter 6

• Recognize the mechanics of the production model, noting process of compiling the production budget as well as issues to consider during construction that can impede its realization

Chapter 7

• Define direct materials and a bill of materials, noting the calculation for direct material purchases
• Identify ways to compile a direct materials budget, noting several anomalies to be aware of when creating this budget

Chapter 8

• Define direct labor and identify the components of the direct labor budget
• Recognize the different methods available for compiling a direct labor budget, noting when these methods are used and their impact on efficiency levels

Chapter 9

• Specify the line items used in the manufacturing overhead budget, noting the classification and nature of these costs

Chapter 10

• Identify the source budgets from which a cost of goods sold budget is derived from, noting additional line items to include as well as reasons for changes in the expense

Chapter 11

• Identify sales and marketing activities that can affect revenue, as well as the methods used to compile and present the sales and marketing budget
• Note when a sales and marketing budget is the most useful and cite an example of how pacing applies to the sales function

Chapter 12

• Note the structure and components of the research and development budget as well as its its impact on funding decisions and project selection
• Recognize the causes of product stagnation, noting the importance of reviewing budget effectiveness

Chapter 13

• Recognize the layout and contents of an administration budget, identifying line items typically found in this budget and ways that administration costs may vary in response to certain activities

Chapter 14

• Identify the methods to review capital budgeting proposals, noting the proper use for each analysis or strategy as well as its impact on purchase of a fixed asset

Chapter 15

• Recognize the components that comprise a compensation budget, a benefits budget, a headcount budget, noting the relationship between budgets and bonus compensation and whether bonuses should be included or not

Chapter 16

• Recognize the components that comprise a master budget, noting factors that impact budgeted asset and liability levels

Chapter 17

• Identify the unique components and line items found in revenue budgets, management and administration budgets, fundraising, and program and grant budgets for nonprofits

Chapter 18

• Recognize the function of a flexible budget, citing its advantages and disadvantages

Chapter 19

• Recognize situations in which costs can vary and when these costs are more likely to be fixed

Chapter 20

• Recognize the function and components of incremental budgeting and zero-base budgeting, noting the developmental processes for each and applicable advantages or problems
• Specify the nature and function of conditional budgeting

Chapter 21

• Identify the reporting systems, goal setting, management roles, compensation issues, and other changes needed to operate without a budget

Chapter 22

• Recognize the focus and function of a rolling forecast, noting the components of a continuous budget variation

Chapter 23

• Identify the procedural steps needed to create a budget, including those steps needed to prevent budget slippage and calculation errors

Chapter 24

• Identify techniques to help with error reduction, data verification, and both model and process simplification to increase the level of efficiency in the budgeting process, noting the impact of simplification over time, process efficiencies, and participative budgeting

Chapter 25

• Identify variances that can be used to compare a budget to actual results

Chapter 26

• Identify the controls that can accompany a budgeting process, noting the intended purpose for the controls