Prepare a preliminary cost benefit analysis, Cost Accounting

Assignment Help:

Managers need financial information to help them make decisions, communicate important information about their organization, and demonstrate fiscal responsibility to stakeholders.  The purpose of this assignment is to familiarize you with preparing and justifying budgets.  This assignment will count for 20% of your final grade.

This assignment requires the use of simple functions in Excel and you should take advantage of these basic formula capabilities.  For example, features like the SUM formula and the "insert sheet" button (for presenting multiple worksheets) will be useful for completing the assignment.  See the Excel Tutorial above for help in remembering these formulas.

Scenario:  Imagine you are the manager of an information resource center in a mid-sized "parent" organization.  Some examples of information resource centers could be: a medical collection in a hospital; a special library in the research & development section of a pharmaceutical company; an archive in a museum; a genealogical collection in a historical society; a school media center in an elementary or high school; a rare book collection in a university library; a business information service in a public library, etc.

Users/Services:  Information resource center users can include organization staff and external users or clients.  Currently users and/or clients come into the resource center and ask for material to be sent to them or they ask for quick answers to simple research or reference questions over the telephone and through email.  The center staff provides a weekly email news briefing covering items of interest to its users and/or clients.  Additionally, center staff collects user data, makes a list of answers to frequently asked questions based on that data, and updates the FAQs regularly.

Collection:  The center has a basic reference collection and a number of subscriptions to online information resources.  If anybody needs highly specialized information, the cost of procuring that information comes out of the parent organization's budget, not from the center, even though the center's staff may identify and procure the specialized information.  New reference material is purchased if it is of general interest or the current material is out of date.

Staff:  Center staff includes: one full-time information professional, one part-time para-professional, and one full-time clerical assistant.

Budget:  The current year operating budget for the center is shown below:

Subscriptions and books                                                                           $ 156,000.00

                Supplies (including photocopies)                                                   9,300.00

                Phone, fax, postage                                                                      4,500.00

                Staff travel                                                                                    1,200.00

                Salaries                                                                                         107,400.00

                Fringe benefits @ 38% of salaries                                                40,812.00

                Organizational overhead @ 21% of non-salary expenses            35,910.00

Assignment:  As part of the newly revised budget process, you have been asked to demonstrate how the center is contributing to the overall organizational mission by developing a program budget for the resource center that ties expenditures to program goals.  To do this, you will need to 1) define a set of appropriate goals for the resource center; 2) identify the resource center programs/services that support these goals; and 3) determine how the direct and indirect costs should be allocated among these programs.  Your goal in presenting your budget is to make the best case you can for the programs/services you need to provide-this involves showing that the resources you are requesting are allocated in the most cost-effective manner possible.

Next, you need to develop and justify an allocation for a new service or product and prepare a preliminary cost benefit analysis for this new service or product.  Finally, as part of the budget process you have also been asked to suggest appropriate salary increases for the staff.  You must support all your recommendations.


Related Discussions:- Prepare a preliminary cost benefit analysis

Cost account ledger system, Cost Account Ledger System A cost account ...

Cost Account Ledger System A cost account ledger system is essential to analyze accounting information in order such costs may be accumulated for individual cost centers and c

The average cost of production, Distinguish between,     (i)  short-run ...

Distinguish between,     (i)  short-run variable costs & long-run variable costs, and give an example of each one;   (ii)  the marginal cost &  the average cost of production

Calculate the inventory turnover ratio, The following information is availa...

The following information is available for the automotive division of Ford Motor Company for 2009.  The company uses the LIFO inventory method.

Explain how individual items of costs will be traced, Glaser Health Product...

Glaser Health Products of Ranier Falls, Georgia, is organized functionally into three divisions: Operations, Sales, and Administrative. Purchasing, receiving, materials and product

Purpose of cost estimation, Purpose of Cost Estimation In estimating i...

Purpose of Cost Estimation In estimating it assists the future expenditure as cost prediction like the expenditure will depend upon the cost of the respective activities a)

Select the correct answer, If fixed costs are $743,122 and variable costs a...

If fixed costs are $743,122 and variable costs are 69% of sales, what is the break-even point in sales dollars? Select the correct answer. A. $512,754 B. $2,397,168 C. $1,255,876 D

Example of contract account, Example of Contract Account  A compa...

Example of Contract Account  A company has been awarded a contract to build a house.  It is a contract Number 45 for the company and the contract price is shs.2.65 millio

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd