Topic 1: Budgets
The collection of related budgets in a company
Unlike the statement of cash flows, this budget estimates the cash receipts and payments for the budgeted period without classifying the cash flows into operating, investing and financing activities.
Cash budget
(Sales - Cost of sales)/Sales *100
Gross Profit Margin
The body that regulates monetary policy
Reserve Bank of Australia
commonly used to set the expected level of activity for the budget period
Sales Budget
A type of sales where the cash is received instantly
Cash Sales
(Current Assets-inventory)/Current Liabilities
Quick Ratio
This is what happens when an externals factors influences the supply or demand
Shift
Another name for Interest rate
Cash rate
In a trading or merchandising business, this contains the amount of inventory that the entity must purchase during each budget period
Purchases budget
A type of sale where the money is not received instantly, but instead over a period of time
Credit sales
Profit(loss)/Amount invested *100
ROI
This is the point where supply and demand are equal
Market Equilibrium
Contractionary monetary Policy
An aggregation of all expense budgets except the cost of sales or cost of goods sold.
This is the first step in preparing a cash budget
Prepare a schedule of receipts from debtors
Profit(loss)/ avg. equity * 100
ROE
This happens whenn the raw materials to make a product increase
Supply shift left
The current cash rate?
2.85bp
Is the inventory of products or stock that a business has to purchase in addition to the units needed to meet the estimated customer demand.
The buffer
This is the second step in preparing a cash budget
Prepare a schedule of cash payments to creditors
Average Total Assets ÷ Average Shareholders' Equity.
Equity Multiplier
This happens when a competitor’s cost od sales increases, meaning they have to raise their prices
Demand shift right
The term that refers to a period of economic stagnation, but high inflation
Stagflation