Cost and Financing in Open Schooling/Budgeting/Incremental Budgeting/CFOS Unit 7 Exercise 7.1-Tips
STEPS IN COMPLETING EXERCISE 7.1
- Calculate personnel expenses for permanent staff based on a 3.25% increase for salaries and all other benefits.
- Calculate expenditure for budget lines that cannot change, e.g. BL 5000 – Depreciation.
- Add together the Budget Lines in Steps 1 & 2 above. Insert your answer in Cell D22.
- Subtract the provisional figure in Cell D22 from the Guideline Amount and insert your answer in Cell D23.
- Add up the figures from the comparable cells in Column C (i.e. Cell C5 & C15). Insert your answer in Cell C22.
- Subtract the figure in Cell C22 from the actual figure for Total Recurrent Expenditure in Cell C19. Insert your answer in Cell C23.
- Divide the figure in Cell D23 by that in Cell C23 and insert your answer in Cell F23. This gives you the factor to use for cutting all other budget lines.
- Use the factor derived in Step 7 to calculate estimated expenditure for all other Budget Lines.