©2013 Cengage Learning. All Rights Reserved. Business Management, 13e Business Financial Records 15.1 Types of Financial Records 15.2 Budgets and Budgeting 15.3 Financial Reports 15.4 Analyzing Financial Data CHAPTER 15
Jan 03, 2016
©2013 Cengage Learning. All Rights Reserved.
Business Management, 13e
Business Financial Records15.1 Types of Financial Records15.2 Budgets and Budgeting15.3 Financial Reports15.4 Analyzing Financial Data
CHAPTER
15
©2013 Cengage Learning. All Rights Reserved.
Business Management, 13e
CHAPTER 15
2
15.1 Types of Financial Records
DLTs● Describe why businesses need to maintain
financial records.● Identify and discuss the purpose of several
types of business financial records.
©2013 Cengage Learning. All Rights Reserved.
Business Management, 13e
CHAPTER 15
3
Financial Records
● Record-keeping systems● Accounting and data processing
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Business Management, 13e
CHAPTER 15
4
Types of Financial Records
● Cash records● Credit records● Depreciation records● Special asset records● Tax and payroll records● Protecting business records
©2013 Cengage Learning. All Rights Reserved.
Business Management, 13e
CHAPTER 15
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15.2 Budgets and Budgeting
DLTs● Describe the uses of several types of business
budgets.● Discuss the reasons managers prepare more
than one budget estimate.
©2013 Cengage Learning. All Rights Reserved.
Business Management, 13e
CHAPTER 15
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Business Budgets
● Importance of budgets● Types of budgets
● Start-up budget● Operating budget● Cash budget● Capital budget● Sales budget
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Business Management, 13e
CHAPTER 15
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Administering the Budget
● Prepare three budget estimates● Use budget to monitor● Make adjustment● Compare budgets to actual results
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Business Management, 13e
CHAPTER 15
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15.3 Financial Reports
DLTs● Describe the contents and explain the purpose
of a balance sheet.● Describe the contents and explain the purpose
of an income statement.
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Business Management, 13e
CHAPTER 15
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Financial Performance and Financial Conditions
● Keep thorough and accurate records● Prepare important financial reports regularly● Interpret the financial information in the
reports● Make decisions that will have a positive
influence on future financial results
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Business Management, 13e
CHAPTER 15
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The Balance Sheet
● Kinds of financial data● Value of balance sheet information
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Business Management, 13e
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The Income Statement
● Kinds of financial data● Value of income statement information
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Business Management, 13e
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CHAPTER 15
Analysis of Budgeted Income Statement
Cost of Goods Sold; 34.7%
Salaries and Wages; 19.5%Advertising/Promo-
tion; 7.9%
Depreciation Expense; 6.6%
Utilities; 6.6%
Supplies and Ma-terials; 6.1%
Miscellaneous Expenses; 1.4%
Net Profit, 17.3%
Total Operating Expenses, 48.1%
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©2013 Cengage Learning. All Rights Reserved.
Business Management, 13e
CHAPTER 15
13
15.4 Analyzing Financial Data
DLTs● Describe several types of financial analysis
that help in the understanding of a business’s financial condition.
● Identify where business owners and managers can turn to get help with understanding and using financial information.
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Business Management, 13e
CHAPTER 15
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Using Financial Information
● Cash flow● Working capital● Financial ratios
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Business Management, 13e
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CHAPTER 15
Cash Flow
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Business Management, 13e
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CHAPTER 15
Working Capital
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Business Management, 13e
©2013 Cengage Learning. All Rights Reserved.
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CHAPTER 15
Financial Ratios
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Sales
Net ProfitReturn on SalesShows how profitable a firm was for a specified period of time
Average Merchandise Inventory
Cost of Goods SoldInventory TurnoverShows whether the average monthly inventory might be too large or small
Current Liabilities
Current AssetsCurrent RatioShows whether a firm can meet its current debts comfortably
Owners’ Equity
Net ProfitReturn on Owners’ EquityShows whether the owners are making a fair return on their investment
Total Assets
Net ProfitReturn on InvestmentShows rate of return on the book value of everything owned in the business