Before spreadsheet was invented, people used to do and solve calculations on a piece of paper or by calculators (they still use calculators even today). Spreadsheet was invented by Dan Bricklin and Bob Frankston in 1979. Visual calculator was in fact the first commercial spreadsheet program. After it was invented, it made peoples’ life much easier in terms of doing calculations automatically, speeding up the calculations, lots of calculations are done simultaneously and also saving up peoples’ time. Spreadsheets are so important today because many companies and organisations use a lot of spreadsheet models to manipulate complex data/ problems as it contains accurate data. Manipulation of data can be applied to non-numeric data. It is a …show more content…
We need to have sufficient information and right tools for cash flow forecast. Sometimes this cash flowing forecast are likely to be more accurate than other types of complex problem. For example a company started their business with £5,000 and their first month’s sale is £5,500, so their end of sales would be £66,000 and expenses would be £55,440 and their net cash flow is £10,503. Budget can be modelled in a spreadsheet. For a successful budget, a plan is needed. The term budget means that an amount of money given to individuals or groups to be used for a particular purpose. If the business does not check their cost then it may face bankruptcy. If people do not keep track of their budget then they might end up in debt sometime. For example the university tuition fees. The tuition fees are so high that students end up taking loans of £27000-30000. But the students cannot return the loan they took as a result they end up committing suicide or sometimes face mental depression. This happens because they don’t have a budget control and also they don’t keep track of the money they are spending. What-if scenario means changing one variable and seeing what happens to other value. Using what-if, quantities of different components can be changed and the results could be analysed. What-if is similar to goal seeking in spreadsheet. For example an ice cream company would ask their staff “What if we increase ice cream sales in the summer rather
This research paper is a brief discussion of budget management analysis. Budgeting is the key to financial management, and is the key to translates an organization goals or plan into money. Budgeting is a rough estimate of how much a company will need to get their work done, and provides the basis for evaluating performance, a source of motivation, coordinating business activities, a tool for management communication and instructions to employees. Without a budget an organization would be like a driver, driving blinded without instructions or any sense of direction, that’s how important a budget is to every organization and individual likewise (Clark, 2005).
A budget is essential for a company to succeed. Without these budgets, it is very hard to be able to see where all
Predicting and managing cash flow. To manage cash flow effectively you must keep a watchful eye on finances. So the business owner should be forecasting and revising their cash flow forecast on a daily basis however, if the finances of the business are more stable then forecasting cash flow weekly or monthly is enough. Cash flow is so important to a business because identity’s shortfalls in cash balances in advance.
Spreadsheets are important as they are able to hold and use complex problem solving, they are also a powerful tool that any size businesses may use to store valuable information. However spreadsheets are also compatible to other programs such as PowerPoint and even word. This could be the reason that so many people use spreadsheets on a daily basis.
A company's budget serves as a guideline in planning and committing costs in order to meet tactical and strategic goals. Tactical goals such as providing budgetary costs for daily operations, and strategic objectives that include R&D, production, marketing, and distribution are all part of the budgeting process. Serving as a guideline rather than being set in stone, the budget is a snapshot of manager's "best thinking at the time it is prepared." (Marshall, 2003, p.496) The budget is a method in which to reign-in discretionary spending, and will likely show variances between what costs have been anticipated and what costs are actually incurred.
Spreadsheets are important as they are able to hold and use complex problem solving, they are also a powerful tool that any size businesses may use to store valuable information. However spreadsheets are also compatible to other programs such as PowerPoint and even word. This could be the reason that so many people use spreadsheets on a daily basis.
Budget is the major financial and economic statement. The role of the budget is to keep track of the money coming in and the money going out. It is essential part of running any business effectively. It can help make a short and long term projections about financial situation, avert a financial crisis and plan for major financial changes.
Budget formulation and use are tools that guide many decision making strategies in business. The measures that are least effective could create an avalanche of catastrophic events that can negatively impact the decision making strategies. It is in the best interest of the pertinent parties to draft an operating budget based on a collective set of information relating to organizational vision and mission. Ineffective measures can be catastrophic based on the foundation for measures used in creating the budget. Among the many issues organizations face that relates to creating an effective operating budget results from poor
A cash flow forecast is estimation of cash coming into the business and of cash going out of the business over a set period of time. A cash flow forecast should demonstrate that your business will have access to enough money to survive. But when estimating the costs you must give reasonable costs because if you estimate the expenses low and the profit high it will cause problems within the business.
Budget is time-consuming, especially if it involves a poorly managed company. The budget only pays attention to the quantitative aspect of business while neglecting the qualitative aspects. It does not consider the quality of services or goods and therefore inconsiderate of customers’ satisfaction. Another disadvantage of a budget is that it is inaccurate. A firm rarely “makes budget.” The hope is that the business activity will be close to the budget, but it could be off considerably and lead to bad hiring, spending and production decisions. This is because budget preparation is based on assumptions and thereby changes in the business environment could lead to unachievable
The next set of valuable learnings in this unit came from advancing my use of functions. I have plenty of practice with the basic functions in Microsoft Excel; functions like SUM and AVERAGE are common place in spreadsheet work. However, I have not fully taken advantage of other functions like MIN, MAX, TODAY, and other useful options. Essentially, functions are a template of their own; they are pre-built functions that can save a lot of time and
“It’s clearly a budget. It’s got a lot of numbers in it” (George W. Busch 2005). This definition of a budget can be supplemented using the Oxford dictionary, which states that a budget is an estimate of income and expenditures for a set period of time. Nowadays almost every business uses budgets and managers use them as a tool in order to set targets. In other words managers can, with the use of budgets, explain in a financial way what are the
Budget is a comprehensive business plan for procuring and appropriating a firm’s financial resources over a specified time period.
A budget is a financial statement which is an estimate of income and expenditure of a set period of time, which may include planned revenues, expenses, assets, liabilities and
Budget and budgetary control practices are undeniably indispensable as organizations routinely go about their business activities and operations. These organizations are constantly on the alert on how actual levels of performance agree with planned or budgeted performance. A budget expresses a plan in monetary terms. It is prepared and approved prior to a particular budgeted period and explicitly may show the income, expenditure and the capital to be employed by organizations in achieving their goals and objectives.