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    Under Estimate Over Estimate

    Uploaded by

    deepu0787
    Sales budgets are estimates of expected sales over a period that take into account probable sales amounts in both value and units as well as expenses incurred during the sales process. They are typically prepared monthly to facilitate comparison against actual spending and control. Sales budgets help achieve profit objectives and serve as mechanisms for planning and control. They include salaries, commissions, office expenses, advertising, travel costs, and other sales-related expenses.

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    Under Estimate Over Estimate

    Uploaded by

    deepu0787
    116 views13 pages
    Sales budgets are estimates of expected sales over a period that take into account probable sales amounts in both value and units as well as expenses incurred during the sales process. They are typically prepared monthly to facilitate comparison against actual spending and control. Sales budgets help achieve profit objectives and serve as mechanisms for planning and control. They include salaries, commissions, office expenses, advertising, travel costs, and other sales-related expenses.

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    Sales Budget

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    Sales budgets are estimates of expected sales over a period that take into account probable sales amounts in both value and units as well as expenses incurred during the sales process. They are typically prepared monthly to facilitate comparison against actual spending and control. Sales budgets help achieve profit objectives and serve as mechanisms for planning and control. They include salaries, commissions, office expenses, advertising, travel costs, and other sales-related expenses.

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as PPT, PDF, TXT or read online from Scribd
    Download as ppt, pdf, or txt
    116 views13 pages

    Under Estimate Over Estimate

    Uploaded by

    deepu0787
    Sales budgets are estimates of expected sales over a period that take into account probable sales amounts in both value and units as well as expenses incurred during the sales process. They are typically prepared monthly to facilitate comparison against actual spending and control. Sales budgets help achieve profit objectives and serve as mechanisms for planning and control. They include salaries, commissions, office expenses, advertising, travel costs, and other sales-related expenses.

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as PPT, PDF, TXT or read online from Scribd
    Download as ppt, pdf, or txt
    of 13

    Sales People under estimate how

    much they spend and over


    estimate how much they sell
    Sales budget
    What It Is????

    The Sales Budget is the estimate of the


    expected sales for the budgeted period.

    It Takes Into Account the Estimates of an


    1) an Operating Periods Probable Sales in Value
    (i.e. In Rupees) and Also in Volume(i.e.In Units)
    and
    2) Likely Expenses Which Are to Be Incurred in
    the Process of Making Sale.
    •Budgets are normally prepared for an
    entire fiscal year but calculated month- by-
    month to make actual spending against
    forecast easier to compare and control.
    SALES BUDGET
    Purpose of Sales Budget
    •Mechanism of Control
    •Instrument of Planning(it aims at
    drafting of alternative sales plan
    and selecting the most appropriate
    one)
    •Sales Budgets helps in achieving
    the profit objectives if the targets
    are not achieved.
    Items Which Are Included in
    the Sales Budget.
    • The salaries paid
    • Projected commissions,bonuses,prizes and
    other payments to salespeople for moving the
    product.
    • The rent and all other office expenses
    • local advertising expenses
    • The phone bills
    • The travelling & entertainment expenses
    • All other expenses incurred in bringing orders
    to office.
    How to Plan a Sales Budget?
    • Top Down Approach : In this type of
    planning top management sets the
    objectives and drafts the plan for all
    units.This approach is based on the
    TheoryX philosophy
    • Bottom Up Approach: Different
    organizational units prepare there own
    separate budget and forward them to
    top mgmt.for consideration. This
    approach is based on TheoryY
    philosophy.
    Warning Signs for out of
    control Expenses.
    • The expenses keeps on creeping up
    and up in each weekly report.
    • Arguments from the salespeople that
    each and every expense is necessary.
    • The ratio between expenses and sales
    is reaching unacceptable proportions.
    • Deviations between the planned
    expenses incurred (if not within the
    permissible limits)
    Steps for correcting the out of
    control budget
    • Place a monetary check on all unnecessary
    expenses such as entertainment etc.
    • Providing necessary information regarding
    expense to sales to each salesperson in his or
    her territory.
    • Check on each and every expense voucher.
    • Make sure that all purchases for office
    supplies and other items go through the
    company.
    How To Control Travel Expenses?
    •The Surefire Method
    •Through Allowances.
    •Discretionary Basis
    •Complete Expense Reimbursement
    •Using a Bonus Plan to control Expenses.
    •By exception
    How to Verify Individual Expense
    Items?

    • Insisting on receipts for all claimed items.


    • Charting Mileage Expense Claims
    • Verifying Travel Itineraries.
    • Checking Up on Actual Amounts Spent.
    Conclusion

    The Sales Budget is a composite of Quotas


    -for Sales, Profits and Expenses and is a
    valuable tool for control.

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