Description
USING ACCOUNTING INFORMATION FOR DECISION MAKING—FINANCIAL INFORMATION AND BUDGETS
For this Assignment, you will take on the role of a consultant and provide two reports on using accounting information for decision making to a fictitious organization so it can better prepare for the future. This week, you will submit the first report, which will focus on financial information and budgeting. Next week, you will submit the second report, which will focus on performance reports and balanced scorecards.
AMcarParts, Inc., a midsize manufacturer of after-market automotive parts, has had an unexpected amount of turnover in its leadership staff, leaving the owners in need of someone who can help them understand accounting concepts, such as strategic planning, budgeting, and forecasting. You have been hired as a consultant to help the owners understand this information for future planning and to assist them with some immediate budgeting needs and concerns.
The product of your analysis will be a business report on using accounting information for decision making that would be delivered to the owners of a midsize manufacturer. In addition to the requirements that follow, be sure to incorporate references to appropriate academic sources, such as those found in this week’s Learning Resources or those in the Walden Library.
RESOURCES
Be sure to review the Learning Resources before completing this activity.
Click the weekly resources link to access the resources.
WEEKLY RESOURCES
To prepare for this Assignment:
Download the Week 1 Part 1 Assignment Template.
Download the Week 1 Part 2 Assignment Template.
Your Instructor will provide part of the data to complete the calculations for the “Budget Preparation” part of this week’s Assignment. To access that information, refer to Doc Sharing.
BY DAY 7
Submit your completed business report and accompanying Excel file. Your report should be 4–5 pages in length (excluding title page and references) and should address the following:
FINANCIAL INFORMATION FOR DECISION MAKING
For this part of your business report, you are to provide an analysis on financial statements, strategic planning, budgeting, and forecasting. In the context of this Assignment, the organization’s leaders would use this information to develop their draft budget, which they would then provide to you for the budget preparation. In your analysis, address the following:
Describe the four basic financial statements—income statement, statement of stockholders’ equity, statement of financial position (also known as a balance sheet), and statement of cash flows—and the purpose of each.
Compare the concepts of strategic planning, budgeting, and forecasting for an organization. Specifically:
Describe each concept and the ways they are interrelated as well as their differences.
Analyze the role that each concept plays within an organization. In your analysis, be sure to include how strategic planning, budgeting, and forecasting are used to improve organizational performance.
Be sure to include citations and references to support your work.
Explain what responsibility centers are (in general) as well as the three types of responsibility centers: cost centers, profit centers, and investment centers.
Identify the decision rights assigned to each type of center, being sure to include examples for each type of responsibility center.
BUDGET PREPARATION
For this part of your business report, you will prepare a budget in Excel and demonstrate how it was developed. You will use the organization’s year-end income statement and ideas the company has for the upcoming year. Be sure to address the following:
Using the Week 1 Part 2 Assignment Template and the data provided by your Instructor in the Doc Sharing area, prepare a budget of the upcoming year for the organization.
Illustrate to the organization how each line item in the budget was prepared. (Note: You will include these notes in the indicated cells within the Assignment Template.)
Note: In addition to submitting your work in Excel, you will insert your budget and your notes into your main document. For information on inserting data from Excel into Word, refer to the following:
Microsoft. (n.d.). Insert a chart from an Excel spreadsheet into WordLinks to an external site.. https://support.microsoft.com/en-us/office/insert-…
Unformatted Attachment Preview
Week 1 Assignment Data
AMcarParts, Inc.
Income Statement
For the Year Just Ended
Revenues
Operating Expenses
Salaries and Wages
Payroll taxes, etc.
Supplies
Delivery Fleet
Communications
Insurance
Office supplies
Miscellaneous
$
$
175,000,000
70,000,000
12,975,000
5,020,000
525,000
1,975,000
195,000
1,835,000
Operating Income
Other Income/Expense
Interest expense
Income Before Income Taxes
Provision for Income Taxes
Net Income
Notes and Assumptions
1. Revenue is from selling after-market automotive parts.
2. Salaries are gross for all employees.
3. Payroll taxes are 40% of salaries and wages.
4. Supplies include raw materials, hardware, tools, etc.
5. Gas, maintenance, etc are for delivery vehicles.
6. Company communication plan.
7. Insurance is for liability, vehicles, and unemployment.
8. Office supplies include all supplies not associated with
manufacturing.
9. Miscellaneous accounts for all other expenses not
covered above.
10. Interest expense is for purchase of the delivery fleet.
11. Provision for income taxes is 22%
© 2022 Walden University, LLC
325,000,000
267,525,000
57,475,000
$
1,980,000
55,495,000
12,208,900
43,286,100
Change
Percentage
Increase
2%
Increase
2%
No Change
0%
Increase
5%
Increase
5%
Increase
2%
Increase
10%
Increase
3%
Increase
No Change
No Change
7%
0%
0%
Page 1 of 1
Week 1 Assignment:
Using Accounting Information for Decision Making—Financial
Information and Budgets
Prepared by: Replace this text with your name.
Date: Replace this text with the submission date.
Walden University
WMBA 6050: Accounting for Management Decision Making
Page 1 of 4
Financial Information for Decision Making
Replace this text with introductory information. Add or remove headings as necessary.
[Heading]
Replace or remove this text. Add or remove headings as necessary.
[Sub-Heading]
Replace or remove this text. Add or remove headings as necessary.
Page 2 of 4
Budget Preparation
Replace this text with introductory information. Add or remove headings as necessary.
[Heading]
Insert your budget and your notes from Excel. Add or remove headings as necessary.
For information on inserting data from Excel into Word, refer to the following:
Microsoft. (n.d.). Insert a chart from an Excel spreadsheet into Word.
https://support.microsoft.com/en-us/office/insert-a-chart-from-an-excel-spreadsheetinto-word-0b4d40a5-3544-4dcd-b28f-ba82a9b9f1e1
Page 3 of 4
References
[Please delete this note before submitting your Assignment. For more information about
formatting your reference list, please visit the following site:
https://academicguides.waldenu.edu/writingcenter/apa/references.]
Include appropriately formatted references to support your Assignment. Refer to the
Assignment guidelines for further information on the requirements.
Page 4 of 4
Instructions:
Your Instructor will provide the numerical data and other information pertaining to the year-end income statement and id
Use that information to complete a budget for the upcoming year by filling in the highlighted cells in the first table.
Then, using the Line Item Notes table, illustrate to the organization how each line item in the budget was prepared by filli
AMcarParts, Inc.
Budgeted Income Statement (Template)
For the Upcoming Year
Revenues
Operating Expenses
Salaries and Wages
Payroll taxes, etc.
Supplies
Delivery Fleet
Communications
Insurance
Office supplies
Miscellaneous
Operating Income
Other Income/Expense
Interest expense
Income Before Income Taxes
Provision for Income Taxes
Net Income
–
$
–
on pertaining to the year-end income statement and ideas the company has for the upcoming year.
y filling in the highlighted cells in the first table.
how each line item in the budget was prepared by filling in the highlighted cells.
Line Item Notes
Purchase answer to see full
attachment
