Lab Budgets Flashcards
What is Forecast budget?
Where budget items such as salaries and benefits are increased or decreased based on previous year’s budget. Based on # of tests performed.Next year’s budget based on revenue from previous year, with expected forecast from anticipated # of tests to be performed.
What is Appropriation budget?
Fixed amount of money is granted for a fixed time period usually 1-2 years. Can cause shortfalls and inappropriate spending. Associated with government bodies.
Budget associated with government bodies
Appropriation budget
Flexible budget is
Where fixed (i.e. overhead) and variable expenses (reagents and consumables) are itemized. Useful when test volumes are subject to change (variable portion can be adjusted accordingly).
Budget used when test volumes are subjected to change
Flexible
Operational budget is
used by lab managers for continuous lab operation
Budget designed for purchase of equipment, expansion of building, or remodeling
Capital/ Capex (capital expenses)
Zero-Base budget is one where
Historical budget info is discarded and each budget cost and revenue item is newly developed. All activities are ranked and highest ranked activities are funded. Eliminates “dead wood”.
What is rolling-quarter budget?
Prepared quarterly and is more accurate than annual budgets
Cash budget is
A financial tool prepared monthly to anticipate cash flow (rate of money received and spent). Used to predict timing and amount of cash flow.
What is cost accounting?
Less formal rules, identifies cost on unit basis and useful for internal purposes. Permits cost assignment to each revenue generating activity.
Financial accounting is
Uses double entry book keeping, follows std reporting forms and generally accepted accounting principles. Cost is looked as aggregate and useful for only external review.
