In the last post, I gave illustrations on how to prepare Financial Budgeting Spreadsheet for Sales and Purchases. I will touch on the last two components, the Operating Expenses and Advertising & Promotion Expenses. With the completion of these two components, I would have completed the entire Financial Budgeting Spreadsheets for Operating Budget.
Continuing from the previous illustration, I assume that the Operating Expenses and Advertising & Promotion Expenses for the last five years were 40% and 20% of Sales respectively. The same assumptions will be used to forecast both the expense lines for the next five years. Upon applying this assumption, the full Operating Financial Budgeting Spreadsheet will be as the following table:
Operating Budget
Well, I have completed the Operating Financial Budgeting Spreadsheet for the next 5 years forecast at this stage. But remember, this is only a first draft Top Down Budget which has not been review by the Operation Division yet. As such, the next step is to send this Operating Financial Budgeting Spreadsheet to the Head of Operations Division for their review and fine tuning.
In the next post, I will talk about how the Operations Division review the Operating Budgeting Spreadsheet in details.
Related article: Preparing the Purchase Financial Budgeting Spreadsheet
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