Page 41 - Budgeting for Managers

ure in a company, come from the work we do and from the
actions we take. So, find out what your department will be
doing and base your budget on that.
Short Term
24 Budgeting for Managers
If we want to build a short-term budget, we might look just one
month or three months ahead, but it’s probably good to plan for
an entire year. Table 2-1 shows a simple annual budget with
monthly, quarterly, and yearly figures.

Year
Quarter
Month (month x 3) (month x 12)

Income $1,250 $3,750 $15,000
Sales
Service contracts TEAMFLY
Expenses 150 450 1,800
Equipment leases
Toner 10 30 120
Plain paper 10 30 120
45
15
Special papers 100 300 180
300
Equipment purchase
75 225 900
Equipment repair 25 75 300
Miscellaneous 7 21 72
Sales tax 109 327 1,308
Total Expenses $501 $1,503 $6,012
Net Income $749 $2,247 $8,988
Table 2-1. Simple budget for a month, a quarter, and a year

This budget is not very realistic. What are the odds that you
will do the same amount of work in a copy shop in August, when
everyone is on vacation, as in September, when everyone is back
and preparing the Christmas marketing campaign? This example
just shows the basic idea of months, quarters, and years. You will
want to make estimates for each month, and then show the quar-
ters as the sum of every three months, rather than just multiply-
ing the figures for one month times three. We’ll show an example
of an annual budget with variable months in Chapter 4.

Team-Fly
®