University of Phoenix Material
Operating Budget Worksheet
Consider the following scenario:
Imagine you are a manager of a small health care facility and in charge of developing a projected annual operating budget.
Your budgetary figures are as follows:
For fiscal year 2015 and 2016 your clinic received $3 million from the government as fee-for-services reimbursements, as well as $1.1 million from private payers. The clinic has an annual fund-raiser that historically brings in $180,000 and a grants department that brings in $1.2 million annually.
Your chief financial officer (CFO) has provided you with the following annual expenses:
|ABC Health Care Annual Expenses|
|Annual salaries||$1.5 million|
|Annual benefits||$ 240,000|
|Annual rent||$ 960,000|
|Annual insurance||$ 45,000|
|Annual depreciation||$ 780,000|
|Annual overhead||$ 180,000|
|Annual supplies||$ 60,000|
Using the ABC Health Care Operating Budget template, complete a 12-month operating budget in which you include the net profit (loss).
Write a 350- to 700-word executive summary that explains to the board of directors how you developed the budget and its importance.
Include the following in your summary:
- Explain the process for creating an operating budget and its importance.
- Explain how revenues and expenses are grouped for planning and control in the financial statements.
- Explain the differences between cash and accrual financial systems.
Cite at least 2 sources, including your textbook.
Format your assignment according to APA guidelines.
Click the Assignment Files tab to submit your assignment.