CPRP- Chapter 2- Budget and Finance
Exam-Graded A
Budget - ANSWER-a prepared plan for financing the work of an organization for a given
period of time
Who is responsible for monitoring a budget? - ANSWER-managers, CEO and board,
but also employees and staff.
variable costs - ANSWER-the costs that result from actual operation of the program and
are charged directly and proportionately to the number of people enrolled.
Program Pricing Formula - ANSWER-P = (F + V) N
P=Price
F= all fixed costs
V= Variable Costs
N= The Demand for the program
Forecasting Revenues and Expenditures - ANSWER-is an art and a science, science
can be determined by history and know facts about the community, art is determined by
the "gut reaction" of the programmer
Capital Budget - ANSWER-planned and proposed expenditures for carrying out major,
nonexpendable purchase and construction projects of a substantial and long-term
nature. Generally costly items, governing bodies usually decide an amount, ex, if it is
over $5000 it is a capital budget item
Compulsory income - ANSWER-Taxes
Real Property Tax - ANSWER-tax assessed on land and anything that is built or
growing on it. This tax is appraised and is usually approximately 30-50% less than fair
market value
Tax rates can also be expressed in Mills - ANSWER-One dollar equals 1,000 mills and
is 1/1000 of the assessed property value.
Personal Property Taxes - ANSWER-allowed in 41 states, ta on tangible property such
as cars, furniture, and intangible property such as stocks and bonds
, Sales Tax - ANSWER-assessed on the sale of many tangible goods
Excise Tax - ANSWER-imposed on specific goods or services such as hotel/motel, car
rental, and "sin" taxes for cigarettes and alcohol. Not unusual for these taxes to be used
for specific purposes.
Income Taxes - ANSWER-assessed on income earned
Gratuitous Income - ANSWER-revenue received without expectation of return and is
from such sources as grants, bequests, and sponsorships
Grants - ANSWER-come from state, federal, and private foundations, but generally run
out at some point, not infinite, be prepared to take over funding
Bequests - ANSWER-funds received from individuals through wills, life insurance
policies, and donations of land and property prior to or upon a person's death
Sponsorships - ANSWER-generally obtained in the form of cash or in-kind services
where companies donate needed supplies, equipment, or staff time/skill. The company
then benefits with advertising, access to participants, ect.
Earned Income - ANSWER-Generated through fees and charges. Program fees,
admission charges, rental fees, user fees, surcharges, etc.
Contractual Receipts - ANSWER-contact with private agencies to provide a service or
sell merchandise. Generally the agency then receives a percentage of the revenues
from the private company.
Investment Income - ANSWER-derived from the interest gained from investing
unneeded agency funds in money markets, stocks, and mutual funds.
Each Department that receives cash payment should have... - ANSWER-Revenue
collection policies and procedures
Established procedures for each collection location
Deposit procedures
Petty Cash - ANSWER-designed for small, quick purchases that are most effectively
made with cash rather than following the lengthier purchasing procedures.
Price Quotes - ANSWER-the staff member details the specifications of the item needed
and then distributes to a select number of vendors. Each vendor is quoting the same
detailed project. The staff member is able to select the businesses it wishes to apply
Formal Bid - ANSWER-Like a price quote, but more structured.
a) an invitation for bid, vendors submit a sealed bid based on advertised specifications
Exam-Graded A
Budget - ANSWER-a prepared plan for financing the work of an organization for a given
period of time
Who is responsible for monitoring a budget? - ANSWER-managers, CEO and board,
but also employees and staff.
variable costs - ANSWER-the costs that result from actual operation of the program and
are charged directly and proportionately to the number of people enrolled.
Program Pricing Formula - ANSWER-P = (F + V) N
P=Price
F= all fixed costs
V= Variable Costs
N= The Demand for the program
Forecasting Revenues and Expenditures - ANSWER-is an art and a science, science
can be determined by history and know facts about the community, art is determined by
the "gut reaction" of the programmer
Capital Budget - ANSWER-planned and proposed expenditures for carrying out major,
nonexpendable purchase and construction projects of a substantial and long-term
nature. Generally costly items, governing bodies usually decide an amount, ex, if it is
over $5000 it is a capital budget item
Compulsory income - ANSWER-Taxes
Real Property Tax - ANSWER-tax assessed on land and anything that is built or
growing on it. This tax is appraised and is usually approximately 30-50% less than fair
market value
Tax rates can also be expressed in Mills - ANSWER-One dollar equals 1,000 mills and
is 1/1000 of the assessed property value.
Personal Property Taxes - ANSWER-allowed in 41 states, ta on tangible property such
as cars, furniture, and intangible property such as stocks and bonds
, Sales Tax - ANSWER-assessed on the sale of many tangible goods
Excise Tax - ANSWER-imposed on specific goods or services such as hotel/motel, car
rental, and "sin" taxes for cigarettes and alcohol. Not unusual for these taxes to be used
for specific purposes.
Income Taxes - ANSWER-assessed on income earned
Gratuitous Income - ANSWER-revenue received without expectation of return and is
from such sources as grants, bequests, and sponsorships
Grants - ANSWER-come from state, federal, and private foundations, but generally run
out at some point, not infinite, be prepared to take over funding
Bequests - ANSWER-funds received from individuals through wills, life insurance
policies, and donations of land and property prior to or upon a person's death
Sponsorships - ANSWER-generally obtained in the form of cash or in-kind services
where companies donate needed supplies, equipment, or staff time/skill. The company
then benefits with advertising, access to participants, ect.
Earned Income - ANSWER-Generated through fees and charges. Program fees,
admission charges, rental fees, user fees, surcharges, etc.
Contractual Receipts - ANSWER-contact with private agencies to provide a service or
sell merchandise. Generally the agency then receives a percentage of the revenues
from the private company.
Investment Income - ANSWER-derived from the interest gained from investing
unneeded agency funds in money markets, stocks, and mutual funds.
Each Department that receives cash payment should have... - ANSWER-Revenue
collection policies and procedures
Established procedures for each collection location
Deposit procedures
Petty Cash - ANSWER-designed for small, quick purchases that are most effectively
made with cash rather than following the lengthier purchasing procedures.
Price Quotes - ANSWER-the staff member details the specifications of the item needed
and then distributes to a select number of vendors. Each vendor is quoting the same
detailed project. The staff member is able to select the businesses it wishes to apply
Formal Bid - ANSWER-Like a price quote, but more structured.
a) an invitation for bid, vendors submit a sealed bid based on advertised specifications
