ACC 561 Week 5 Assignment 1: Financial Review

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Decision Making Accounting (ACC) 561 November 11, 2010 Eddie Mattison, Facilitator Decision Making Budgets and Performance Reports “Budgets…help to coordinate and implement plans. They are the chief devices for disciplining management planning. Without budgets, planning may not get the front and center focus that it usually deserves.” (Horngren at el. 2008, p. 13) Guillermo must be able to operate within his budgets; otherwise he may begin to operate at a profit loss. Creating a budget will allow Guillermo to know the exact amount of money that he has to allocate to specific expenses. “Performance reports provide feedback by comparing results with plans and by highlighting variances, which are deviations from plans.” (Horngren at el. 2008, p. 13) Guillermo can use performance reports to determine if changes that he makes positively or negatively affect his bottom line. By using both budgets and performance reports Guillermo should be able to outline a plan that will balance company/organizational goals, personal goals, and maintain profitability. Ethics Influence Regulations and standards such as Generally Accepted Accounting Principles (GAAP), Foreign Corrupt…show more content…
Guillermo must figure out how to continue to compete with the increased competition, expanding market, and increases in cost of labor. He must handle these changes and also decide how to continue to be independent and keep as much of his personal time as possible. Guillermo can better make these decisions by using accounting tools such and budget and performance reports, sift through and utilize pertinent information, and finally continue to act ethically and within the law. References Horngren at el. (2008). Introduction to Management Accounting (14th ed.). New Jersey: Pearson-Prentice Hall. University of Phoenix. Scenario: The Guillermo Furniture Store. Retrieved from University of Phoenix, ACCT/561
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