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.