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Budget Development

Budget Development

Budget Development


If your organization makes frequent business transactions, one of  the tasks you face as a manager is budget preparation. A budget is a  tool used for planning and controlling financial resources. It guides  your future plan of action in financial terms within a set period of  time. A budget does not have to be complex; however, it should support  the organization’s strategic plan. We will need resources to achieve our  goals and objectives.

For this assignment, you will focus on the operating budget. An  operating budget shows the company’s projected revenue and associated  expenses for an upcoming period—usually the next year. An operating  budget starts with revenue and then shows each expense type. This  includes variable costs—or the costs that vary with sales—such  as the cost of raw materials and production labor. The operating budget  includes fixed costs, such as the monthly rent on office space or the  monthly payment for a photocopier lease. The budget also includes  operating expenses, such as interest on business loans, and the noncash  expense of depreciation. These items enable the company to compute its  projected net income and net profit percentage.


Imagine you are the health care administrator for a nonprofit  clinic, home health agency, or outpatient surgery center. Your first  task is to locate the strategic plan for that organization or determine  its strategic direction through the vision statement, mission or purpose  statement, and strategic priorities or goals. You will also need the  audited financial statements for the organization.

Using the information from your research, develop a one-year  operating budget for the chosen entity, which will include operating  revenues and expenses. Include a 1–2 page document to justify the  approach you use in constructing the operating budget with the strategic  plan or strategic direction.

  • Upload the strategic plan or strategic direction and audited financial statements as an attachment or include the Web link.
  • Complete your operating budget using Excel.
  • Support your work with at least three quality references, one  being your course textbook. These should be cited per the Strayer  Writing Standards.

This course requires the use of Strayer Writing Standards. For  assistance and information, please refer to the Strayer Writing  Standards link in the left-hand menu of your course. Check with your  professor for any additional instructions.

The specific course learning outcome associated with this assignment is:

  • Develop a budget for a department within a healthcare organization.

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