The Unit 5 assignment requires you to prepare a budget for a hypothetical organization. The assignment simulates what financial leaders do in the real world:
• Present clear, professional budgets
• Justify why their numbers are appropriate for meeting the organizations’ stated mission
Keep in mind that this is NOT a computational exercise (where you merely fill in a spreadsheet). It is a leadership exercise (where you must convince others that your budget is appropriate).
• Develop an annual budget for the organization; place it in an appendix at the end of the paper. Make sure the font size in the budget is readable. Consider providing a side-by-side comparison for the current year as well as next year. See the abbreviated sample below.
Budget Item Current Year Next Year Change (+/-)
(Excel Table)
Item 1 $1,000 $1,200 $200
Item 2 $800 $400 ($400)
Item 3 $5,000 $5,600 $600
Total $6,800 $7,200 $400
• Write a paper that presents a budget for a hypothetical organization (see below scenario).
• State and defend any assumptions you made when preparing the budget (i.e., the budget assumes the current lease is $1,500/month).
• Do not guess or make up fictional numbers. Locate research about comparable numbers to support your analysis.
• Present and discuss each line item of the budget.
• Defend why the budget distribution is appropriate to meet the organization’s stated mission and revenue goals. For instance, if your budget indicates 3% growth in revenues, then discuss what activities in the budget (e.g., hiring more sales staff, purchasing more advertising, etc.) support your forecast that revenue will increase by 3%. Include citations to support your revenue forecast.
• Keep in mind that there is not a “right” or “wrong” approach. Just clearly identify your numbers – then justify (with citations from relevant and current references) why your budget recommendations are appropriate.
• Scenario: Small Nonprofit Organization – You are the executive director of a small nonprofit organization that has been in business for 3 years. The mission of the nonprofit is to provide support services for homeless individuals in Edmond, Oklahoma.
o Last Year’s Budget: $500,000
o Goal: 5% growth ($25,000)
o Next Year’s Budget: $525,000
o Paid Personnel:
1 executive director (you)
2 case workers
o Other Information:
1-year lease for office/community meeting space
