Business Finance
Can someone explain this budget in detail and what it is saying

Question Description

Explain this budget in one detailed page.

I have included the budget done already and reviews from two classmates. Please be specific in the report and talk about the numbers.

This was the original assignment.

1) A summary budget (total org budget including all programs, administrative and development revenues and costs by natural classification) with budget totals compared to last year’s actuals (and budget if available)

2) The budgeted details for at least one program (more if org has multiple programs) and administrative and fundraising costs (see pptx for examples of multi-column presentation examples

3) Information showing how income was estimated/calculated with details (what specific sources in what amounts, Hint: look well at Budget Book chptr 15 for a template on how to report this info)

4) Information showing how salaries and benefits were calculated and allocated (see ppt and excel allocation examples for reference)

5) A narrative of no more than 2 pages explaining the budget (highlights), connecting it to the organization’s mission and explaining how general costs were allocated (what methodology was used: see ppt for ways/methods of expense allocation)

I understand this was a challenge that is why i gave you an example.

BUDGET ASSIGNMENT

From my professor---
I have begun to review your budget assignment and I am running into a snag. I need to talk to you about it, but I won't have time until we return from the Thanksgiving break.

Unformatted Attachment Preview

This review was nice but the professor is not going to be nice so I need to be prepared. Manage Discussion Entry • • • • • • • • Is the budget relevant to the mission? It is my understanding that this organization is designed to assist the low-income population. While I feel that the budgeted positions and programs are meaningful to this mission, there needs to be more focus on increasing revenue whether it is through fundraising, grants, fee increases, etc. The increase of the revenue will allow the organization to expand their programs and opportunities they are providing to the community. Is the budget reasonable based on last year’s actual and the information in the narrative? The projected summary budget is reasonable in the fact that there are minor decreases made to each category in order to cut expenses to avoid a deficit at the end of the fiscal year. There are two concerns I have with the projected budget. When it comes to the income estimations, only four out of eighteen revenue sources have a 50% chance or higher of being received. The other concern I have is in regards to the staffing expense. If I am basing the salary costs off of the budget narrative, the salary expense ($165,000) is too large in relation to the revenue that the organization has coming in ($200,000). If I am basing the salary costs off of the excel spreadsheet, the salary costs ($20,000) are too low and this could result in employees deciding to leave the organization to find more reasonable compensation. As a board member, because of these concerns, I would have difficulty passing this budget unless there was a solid plan in place to increase revenue and / or decrease expenses. Is the income feasible? When it comes to the revenue of the organization, there are not any major changes other than a large decrease ($15,000) in other income. From looking at the revenue that was received last year, I would believe with a reasonable doubt that the organization would receive the revenue they are projecting. While there are not many major revenue changes between the two fiscal years, the income estimation excel spreadsheet shows that there are many revenue sources that have less than a 50% likelihood that they will be received. If I were on the Board of this organization, this would be concerning to me. Are the salaries comparable to others in the field and reasonable for the positions? With the total revenue for the organization being $200,000, it is difficult to have reasonable salaries for 10 positions and be able to cover all organizational expenses. According to the budget narrative, the salaries will total $165,000, which will only leave $35,000 to take care of all other budget expenses. While the narrative is projecting $165,000 for salaries, the total salary cost on the excel spreadsheet is $20,000 which will result in extremely low annual salaries for all positions and will create a challenge in retaining talented staff. It is tough to provide all the employees with a reasonable salary when you are working with • • • such a limited amount of annual revenue. In this case, positions would need to be eliminated or programs would need to encounter severe cutbacks, which could have a detrimental effect on the organization because the programs are in such high demand. Do you think that the upcoming years actual will reasonably reflect what is in the budget you are viewing? If the projected income is received, I do believe that the actual will reasonably reflect what is in the budget because there have not been that many major changes made and in the past year, the organization came out with a low deficit of $4,250. Even though I believe the organization can come close to the projected budget, they will most likely encounter two issues. Due to the low salaries in regards to the staff, the organization will have a high turnover rate due to the challenges of retaining employees. The second issue would depend on the organization’s net assets. It seems with the projected income and expenses, the organization will continue to end the fiscal year with a small surplus or a small deficit, which will prevent the organization from creating any type of sustainability plan for the future. Collapse SubdiscussionHeather Buntz Heather Buntz FridayNov 17 at 11:45pm Manage Discussion Entry o o Is the budget relevant to the mission? It is my understanding that this organization is designed to assist the low-income population. While I feel that the budgeted positions and programs are meaningful to this mission, there needs to be more focus on increasing revenue whether it is through fundraising, grants, fee increases, etc. The increase of the revenue will allow the organization to expand their programs and opportunities they are providing to the community. o Is the budget reasonable based on last year’s actual and the information in the narrative? o The projected summary budget is reasonable in the fact that there are minor decreases made to each category in order to cut expenses to avoid a deficit at the end of the fiscal year. There are two concerns I have with the projected budget. When it comes to the income estimations, only four out of eighteen revenue sources have a 50% chance or higher of being received. The other concern I have is in regards to the staffing expense. If I am basing the salary costs off of the budget narrative, the salary expense ($165,000) is too large in relation to the revenue that the organization has coming in ($200,000). If I am basing the salary costs off of the excel spreadsheet, the salary costs ($20,000) are too low and this could result in employees deciding to leave the organization to find more reasonable compensation. As a board member, because of these concerns, I would have o o o o o o difficulty passing this budget unless there was a solid plan in place to increase revenue and / or decrease expenses. Is the income feasible? When it comes to the revenue of the organization, there are not any major changes other than a large decrease ($15,000) in other income. From looking at the revenue that was received last year, I would believe with a reasonable doubt that the organization would receive the revenue they are projecting. While there are not many major revenue changes between the two fiscal years, the income estimation excel spreadsheet shows that there are many revenue sources that have less than a 50% likelihood that they will be received. If I were on the Board of this organization, this would be concerning to me. Are the salaries comparable to others in the field and reasonable for the positions? With the total revenue for the organization being $200,000, it is difficult to have reasonable salaries for 10 positions and be able to cover all organizational expenses. According to the budget narrative, the salaries will total $165,000, which will only leave $35,000 to take care of all other budget expenses. While the narrative is projecting $165,000 for salaries, the total salary cost on the excel spreadsheet is $20,000 which will result in extremely low annual salaries for all positions and will create a challenge in retaining talented staff. It is tough to provide all the employees with a reasonable salary when you are working with such a limited amount of annual revenue. In this case, positions would need to be eliminated or programs would need to encounter severe cutbacks, which could have a detrimental effect on the organization because the programs are in such high demand. Do you think that the upcoming years actual will reasonably reflect what is in the budget you are viewing? If the projected income is received, I do believe that the actual will reasonably reflect what is in the budget because there have not been that many major changes made and in the past year, the organization came out with a low deficit of $4,250. Even though I believe the organization can come close to the projected budget, they will most likely encounter two issues. Due to the low salaries in regards to the staff, the organization will have a high turnover rate due to the challenges of retaining employees. The second issue would depend on the organization’s net assets. It seems with the projected income and expenses, the organization will continue to end the fiscal year with a small surplus or a small deficit, which will prevent the organization from creating any type of sustainability plan for the future. • ReplyReply to Comment Manage Discussion Entry Is (or is not) the budget relevant to the mission? why? - I believe that the budget is relevant to the mission of Jars of Clay, which aims to help individuals and families face poverty, human rights and civil rights issues. About 48% of all income is budgeted towards programming, 2% is budgeted towards administration and 50% is budgeted towards fundraising. As Faye indicated, Jars of Clay is a small organization. It seems like the organization is also in a growth stage or startup stage. As the organization continues to grow, I can easily see more of the income being dedicated towards mission related endeavors. Is the budget reasonable based on last year’s actual and the information in the narrative? (point to specifics) - I believe that the budget is somewhat reasonable and a bit conservative. The income remained the same from FY16 actuals to the proposed FY17 budget ($200,000.00) The deficit from FY16 however, was proposed to be wiped out and FY17 is supposed to end with a $10,000.00 surplus. For an organization possibly in the startup or growth stage, this is certainly a benefit. The only thing I really question is the salary expenses. There are three different numbers mentioned across the narrative, program budget and salary calculations. If that issue was rectified, I would be able to make a better determination as to if the budget was reasonable or not. Is the income feasible? (upon what is your assessment based?) o The income estimations draw a concern for me. With the exception of staff quarters, all other revenue streams have a 50% or lower chance at being received. As I indicated above, the income also remained the same at $200,000.00 from FY16 to FY17. Even if the organization is in the startup or growth stage, it is still a concern. These issues would be expected in the startup or growth stage, but the organization would still need to find new revenue sources or expand on their current sources in order to survive. Faye also indicated that all programs are vetted once a new funding source is considered. This is a great practice that will no doubt help them down the line when more funding is acquired. • • Are the salaries comparable to others in the field and reasonable for the positions? (how do you know this, What data specifically informed your evaluation of the question?) • -It's difficult to determine if the salaries are comparable to others in the field. A salary breakdown is brought up in both the narrative and salary calculations tab. The salary calculation numbers are more relevant to what The Salvation Army Corps Officers make while the narrative numbers seem more reasonable for nonprofits in general across the board. Either way, both salary breakdown totals are not reasonable for the Jars of Clay overall budget. The narrative budgets for $165,000.00 in salaries while the salary calculations tab budgets for $82,000.00. Both salary totals are much too large for an organization with only a $200,000.00 overall budget. The program budget salary number of $20,000.00 is more reasonable, although low. They organization could perhaps lean on volunteers to make up for the low paid staff. • Do you think that the upcoming years actual will reasonably reflect what is in the budget you are viewing? (if yes, why do you feel assured, if not, why not?) • - If the total budgeted salaries are indeed at $20,000.00 overall as indicated in the program budget, then I believe the organization can be sustainable and reflect the proposed budget accurately. There was a small deficit in FY16 and a surplus proposed for FY17. As long as new funding sources are identified or increased, the organization should continue to grow in a positive direction. Program Name Joan Levy Mike Sandoval Sharon Bailey Robert Thompson Erica Mendez Jemel Bryson Position Chief Executive Officer Executive Vice President Volunteer Coordinator Fundraising Manager Administrtive Assistant Maintenance Kids on the Go 10% 10% 40% 5% 10% 30% 105% 35.00% Program Peek Moments 10% 10% 40% 5% 10% 30% 105% 35.00% General & Administrative Fundraising 50% 30% 10% 20% 70% 40% 220% 36.7% 30% 50% 10% 70% 10% 0% 170% 28.3% Toatal 100% 100% 100% 100% 100% 100% 600% Name Joan levy Mike Sandoval Sharon Bailey Robert Thompson Erica Mendez Jemel Bryson Position Chief Executive Officer Executive Vice President Volunteer Coordinator Fundraising Manager Administrtive Assistant Maintenance Total Salaries Salary $250,000.00 $200,000.00 $52,500.00 $72,500.00 $47,000.00 $24,550.00 $646,550.00 25.27% Total program salaries Total g&a salaries Total Fundraising Total salaries Name Joan Levy Mike Sandoval Sharon Bailey Robert Thompson Erica Mendez Jemel Bryson Name Joan Levy Mike Sandoval Sharon Bailey Robert Thompson Erica Mendez Jemel Bryson Total $163,380.00 $247,470.00 $235,700.00 $646,550.00 Position Chief Executive Officer Executive Vice President Volunteer Coordinator Fundraising Manager Administrtive Assistant Maintenance Position Chief Executive Officer Executive Vice President Volunteer Coordinator Fundraising Manager Administrtive Assistant Maintenance Payroll Tax $18,750.00 $15,000.00 $3,937.50 $5,437.50 $3,525.00 $1,841.25 Fringe Benefits $48,175.00 $40,150.00 $16,476.25 $19,686.25 $15,593.50 $11,990.28 $152,071.28 Program Intillectual Disabilities Homelessness $25,000.00 $25,000.00 $20,000.00 $20,000.00 $21,000.00 $21,000.00 $3,625.00 $3,625.00 $4,700.00 $4,700.00 $7,365.00 $7,365.00 $81,690.00 $81,690.00 25.27% General & Administrative $125,000.00 $60,000.00 $5,250.00 $14,500.00 $32,900.00 $9,820.00 $247,470.00 38.3% $1,875.00 $1,500.00 $1,575.00 $271.88 $352.50 $552.38 $1,875.00 $1,500.00 $1,575.00 $271.88 $352.50 $552.38 $9,375.00 $4,500.00 $393.75 $1,087.50 $2,467.50 $736.50 $4,817.50 $4,015.00 $6,590.50 $984.31 $1,559.35 $3,597.08 $4,817.50 $4,015.00 $6,590.50 $984.31 $1,559.35 $3,597.08 $24,087.50 $12,045.00 $1,647.63 $3,937.25 $10,915.45 $4,796.11 $21,563.75 $21,563.75 $57,428.94 Fundraising $75,000.00 $100,000.00 $5,250.00 $50,750.00 $4,700.00 $0.00 $235,700.00 36.5% Toatal $250,000.00 $200,000.00 $52,500.00 $72,500.00 $47,000.00 $24,550.00 $646,550.00 $5,625.00 $7,500.00 $393.75 $3,806.25 $352.50 $0.00 $18,750.00 $15,000.00 $3,937.50 $5,437.50 $3,525.00 $1,841.25 $14,452.50 $20,075.00 $1,647.63 $13,780.38 $1,559.35 $0.00 $48,175.00 $40,150.00 $16,476.25 $19,686.25 $15,593.50 $11,990.28 $51,514.85 $152,071.28 Variety Club Camp & Developmen Ctr Summary Budget Revenue Conrtibutions & Grants Program Service Other Revenue Investement Income Fee Income Total Revenue Expenses Salaries Fringe Benefits Payroll Tax Office Expense Occupancy Travel Conference , Conventions, Meetings Depreciation Food & Dining Insurance Bad Debt Program Supplies Repairs & Maintenance All other expenses Other Total Expenses Net Totals *all funds are unrestricted *travel expenses were cut through increases virtual meetings *Conventions/meetings cost were cut due to departmental collaboration *Administrative Assistant resigned, position filled with volunteer surplus due to decreased A/A salary, payroll taxes & fringe benefits 2018 Proposed Budget 2017 Actual 2017 Budget 417,000 885,000 112,500 37,000 27,900 1,479,400 $416,412.00 $883,483.00 $111,073.00 $36,778.00 $2,700.00 $1,450,446.00 $425,494.00 $885,000.00 $100,257.00 $37,750.00 $2,669.00 $1,451,170.00 $599,550.00 $37,554.00 $59,256.00 $45,000.00 $103,000.00 $10,000.00 $8,000.00 $145,000.00 $30,000.00 $109,700.00 $3,700.00 $82,000.00 $75,000.00 $62,000.00 $65,000.00 $646,550.00 $41,079.00 $74,849.00 $46,979.00 $102,794.00 $11,241.00 $9,310.00 $145,365.00 $30,535.00 $109,676.00 $3,750.00 $81,162.00 $75,651.00 $6,164.00 $64,166.00 $652,312.00 $40,250.00 $75,990.00 $44,598.00 $101,777.00 $11,200.00 $9,111.00 $144,000.00 $31,312.00 $107,951.00 $3,700.00 $82,000.00 $75,975.00 $6,500.00 $64,000.00 $1,434,760.00 $1,449,271.00 $1,450,676.00 $44,640.00 $1,175.00 $494.00 2016 Actual 2016 Budget $369,663.00 $883,564.00 $100,000.00 $36,765.00 $2,980.00 $1,392,972.00 $366,998.00 $882,678.00 $99,745.00 $35,042.00 $2,500.00 $1,386,963.00 $670,291.00 $41,079.00 $74,849.00 $43,564.00 $100,600.00 $10,781.00 $91,898.00 $144,576.00 $31,112.00 $106,700.00 $3,690.00 $81,750.00 $74,557.00 $65,000.00 $53,218.00 $672,000.00 $41,000.00 $75,112.00 $45,688.00 $101,314.00 $10,997.00 $92,000.00 $142,300.00 $30,767.00 $105,170.00 $3,600.00 $80,198.00 $73,290.00 $63,743.00 $52,500.00 $1,593,665.00 $1,589,679.00 -$200,693.00 -$202,716.00 Sources, Types, and Amounts of Funds 2016 - 2017 Contributions Source(s) Hogs & Honey Foundation for Kids Subtotals Contributions Amounts ($) $ 250,000.00 $ 250,000.00 Source(s) The Wawa Foundation Subtotals Contributions Amounts ($) $ 210,000.00 $ 210,000.00 Source(s) Harriette & Charles Foundation Subtotals Contributions Amounts ($) $ 391,200.00 $ 391,200.00 Source(s) Tabas Foundation Subtotals Contributions Source(s) Genuardi Family Foundation Subtotals Contributions Amounts ($) $ 95,000.00 $ 95,000.00 Estimated Values $ 55,337.00 $ 55,337.00 Source(s) Child Development Foundation Subtotals Grand Total Amounts ($) $ 477,863.00 $ 477,863.00 $ 1,479,400.00 16 - 2017 Liklihood of Funding (%) 90%% Liklihood of Funding (%) 100% Liklihood of Funding (%) 100% Liklihood of Funding (%) 100% Liklihood of Receipt 50% Liklihood of Funding (%) 40% Variety Club Camp & Development G&A Revenue/Income Categories Hogs and Honeys Foundation for Kids The Wawa Foundation Harriette & Charles Foundation Tabas Foundation Genuardi Family Foundation Child Development Foundation Revenue $40,000 $20,000 $10,000 $5,000 $5,000 $80,000 $160,000 G&A Expense Categories Salaries & Benefits Fringe Benfits Payroll Tax Office Expense Occupancy Travel Conference,Conventions, Meetings Depreciation Food & Dining Insurance Bad Debts Program Supplies Repairs & Maintenance All Other Expenses Other Expense Categories Sub-Total Revenue After Expenses Fundraising $0 $0 $1,200 $0 $337 $0 $1,537 Fundraising $247,470 $41,079 $74,849 $46,979 $102,794 $11,241 $9,310 $145,365 $5,000 $54,838 $3,750 $81,162 $75,651 $235,700 $0 $0 $0 $0 $0 $0 $0 $1,000 $54,838 $0 $0 $0 $64,166 $963,654 $0 $291,538 Intellectual Disabilities $0 $0 $190,000 $10,000 $25,000 $198,932 $423,932 Programs Hoemlessness $210,000 $190,000 $190,000 $80,000 $25,000 $198,932 $893,932 Total (FYE) $250,000 $210,000 $391,200 $95,000 $55,337 $477,863 $1,479,400 Total Revenue Philly Scholars Homelessness $81,690 $0 $0 $0 $0 $0 $0 $0 $12,268 $0 $0 $0 $0 $81,690 $0 $0 $0 $0 $0 $0 $0 $12,268 $0 $0 $0 $0 $0 $93,958 $0 $93,958 Total Organization Expenses $1,479,400 Total $646,550 $41,079 $74,849 $46,979 $102,794 $11,241 $9,310 $145,365 $30,535 $109,676 $3,750 $81,162 $75,651 $6,164 $64,166 $1,449,271 BUDGET FY 2017 ACTUAL - DETAIL FY 2016 BUDGET FY 2016 Income Program Fees Rentals United Way Public Support Hope House Atlanta Other Income Total Income $ $ $ $ $ $ $ 40,000 30,000 25,000 5,000 50,000 50,000 200,000 $ $ $ $ $ $ $ 36,000 *See narrative note 27,000 22,500 4,500 45,000 65,000 200,000 Expenses Salaries Benefits and Payroll Taxes Contracted Services Food Transportation Program Supplies Office Supplies/Tech Professional Fees/Dues Utilities Insurance Maintenance/Repairs Building Publications Training/Conference Travel Misc Depreciation Total Expenses $ $ $ $ ...
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Final Answer

Attached.

The budget summary in the spreadsheet has been well developed. As can be seen,
2017 estimates have been achieved by multiplying the estimates from 2016 by 1.11. This is
not logical as the narrative states clearly that the extra expenses during 2016 were as a result
of the purchase of a house for 20,000. This means that the income shou...

Doctor_Ralph (19951)
Duke University

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