Healthcare Budget Request – Budget Development

Week 6 Assignment.

I am posting this early as I know that many of you are working when you can. If the images do not come through on your email, please refer to the Announcement board.

For the Week 6 assignment, start with transferring your week 4 work to the next template. Be sure you include formulas because if you do a copy and paste, the formulas most likely will not move with the paste. It is good practice to put them in again.

Update any areas that I give you feedback. I will try my best to have all the week 4 assignments graded by this Friday afternoon. That way you have feedback to work from.

Be sure to review the section in the Guide for this assignment. In your analysis, identify if you are planning any capital budget items. Are they long-term assets?  How much working capital will you require for day-to-day operations? Did you identify any new costs or revenue?

You will add one new analysis- Calculate the payback period.  This begins by determining cash flow. Add a row where you calculate Total revenue minus Total expenses.

It has come to my attention that there are 2 errors in the course directions for the upcoming assignment.

1.      On pages 21 and 23 of the Healthcare budget Request Workbook: Step-by-step Guide there is an error. In year 3, the Net Cash Flow should be 100 (NOT 300).

2. Next,

It might be helpful to see how your assignment should look (with your data of course).

The Assignment: Budget Development

Develop and analyze a budget for your proposed healthcare product or service. To do this, complete the following:

Part 1: Develop the Budget Worksheet:

Open your Healthcare Budget Request workbook that you created in the previous Assignment, and navigate to the “A4 Budget Development” worksheet.

· Using the Healthcare Budget Request Workbook Step-by-Step Guide for guidance, create a 5-year budget for the healthcare product or service that records the projected expenses and revenues associated with the healthcare product or service you have proposed. Be sure to include startup and operating expenses in your budget.

· Calculate the budget ratios as directed in the Healthcare Budget Request Workbook Step-by-Step Guide.

NOTE: You will copy your worksheet and analysis onto the Healthcare Budget Request Template (Word document) for submission.

Part 2: Summary of Analysis and Interpretation of Results:

Create a brief (1- to 2-page) description of your budget and analysis that clearly describes the budget. Be sure to address the following:

· During the course of 5 years, is there an estimated surplus or deficit?

· What percentages of the budget are dedicated to various categories you have defined, such as startup costs, etc.?

· What does this budget mean for your organization?

References:

Penner, S. J. (2016). Economics and financial management for nurses and nurse leaders (3rd ed.). New York, NY: Springer Publishing Company.

Chapter 5, “Reporting and Managing Budgets” (pp. 111–136)

Chapter 6, “Budget Planning” (pp. 141–161)

Chapter 7, “Special Purpose, Capital, and Other Budgets” (pp. 163–186)

Cross, V. (2019). The role of variance analysis in businesses. Retrieved from https://smallbusiness.chron.com/role-variance-analysis-businesses-22641.html

Garcia, M. (n.d.). What does an unfavorable variance indicate? Retrieved April 23, 2019 from http://smallbusiness.chron.com/unfavorable-variance-indicate-81570.html

Investopedia. (2019, March 31). What is a budget? Budgeting terms and tips. Retrieved from https://www.investopedia.com/terms/b/budget.asp

Johnston, J. (2017, January 6). With so much uncertainty, how do you build your hospital’s budget? Retrieved from https://www.hfma.org/Content.aspx?id=51828

Johnston, K. (n.d.). How to develop a budget for a new product or service. Retrieved April 23, 2019 from https://smallbusiness.chron.com/develop-budget-new-product-service-38629.html