BUDGETING AS A TOOL FOR PLANNING AND CONTROL IN MANUFACTURING INDUSTRY
Rated 5/5 based on 7,652 reviews
Enugu, Nigeria
Nigeria
Enugu State
Nigeria

Budgeting As A Tool For Planning And Control In Manufacturing Industry

Get the Complete Project Materials Now! ยป

BUDGETING AS A TOOL FOR PLANNING AND CONTROL IN MANUFACTURING INDUSTRY

(A CASE STUDY OF NIGERIA BREWERIES PLC ENUGU)

ABSTRACT

This research work has focused on investigation on the use of budgeting as a tool for planning and control in topical manufacturing industry like Nigeria breweries Plc, Enugu. The objective of the study is the show the important of budgeting as a tool for planning and control in operation of a manufacture industry which has profit maximization as its principal objectives the research also aims at identifying the procedures adopted in the formulation of annual budgets of Nigerian Breweries Plc. Based on this, the following hypothesis was formulated for the study, the hypothesis is include:

1.  Managers use budget as a tool for planning and controlling the good of the business or organization

2.  Decision making is performed in a manufacturing industry using budget.

3.  Utilization of resources is achieved with the use of budget and budgetary control.

Following the investigation and analyzasion of the data the following findings were made:

1.  The organization uses budgeting in achieving their goals and objectives which can be with out

2.  The main objective of the organization is maximization of profit which will be done through budget.

3.  Efficiency and effectiveness of the organizations operation as enhanced through the use of budgeting e.t.c.

From the findings the conduction were arrived that budgeting is a very essential and indispensable tool for planning and control it helps management to be well structured in sustaining the growth and expansion of the organization.

 

TABLE OF CONTENTS

Title Page                                                                     i

Approval Page                                                                      ii

Dedication                                                                    iii

Acknowledgement                                                         iv

Abstract                                                                       v

Table of content                                                            vi

List of table                                                                  x

CHAPTER ONE: INTRODUCTION

1.1      Background of the study                                          1

1.2      Statement of the problem                                        5

1.3      Objective of the study                                             6

1.4      Hypothesis                                                            7

1.5      Research question                                                  8

1.6      Significance of the study                                          8

1.7      Scope of the study                                                 9

1.8      Definition                                                              10

CHAPTER TWO: REVIEW OF RELATED LITERATURE

2.1 Definition of budget                                                 12

2.2 Features and functions of budget                               14

2.3 Preparation of budget                                               19

2.4 Types and methods of budget                                    23

2.5 Planning function in an organization                                   33

2.6 controlling functions in an organization                       37

2.7 Budgetary control and analysis of variance                   40

CHAPTER THREE: RESEARCH METHODOLOGY

3.1      Research design                                                     43

3.2      Area of the study                                                    43

3.3      Population of the study                                           44

3.4      Sampling method                                                   44

3.5      Research instrument                                               46

3.6      Validity and reliability of research instrument                     47

3.7      Sources of data                                                      48

3.8      Method of investigation                                           50

CHAPTER FOUR: PRESENTATION, ANALYSIS AND INTERPRESENTATION OF DATA

4.1 presentation and analysis of data                               52

4.2 Testing of hypothesis                                               65

CHAPTER FIVE: SUMMARY OF FINDINGS, CONCLUSION AND RECOMMENDATION

5.1 Summary of findings                                                       73

5.2 Conclusion                                                              77

5.3 Recommendation                                                     78

       References                                                            

Appendix                                                              

Questionnaires

LIST OF TABLE

Table 4.1.1:    Employment of planning and control            53

Table 4.1.2:    If the company uses budget                       53

Table 4.1.3:    Whether planning and control helps

                     efficiency                                                 54

Table 4.1.4:    Ways budgeting has helped the organization55

Table 4.1.5:    The effect of decision making in the

                     organization                                             56

Table 4.1.6:    If the company has encountered any problem in                       organizational decision                               56

Table 4.1.7:    The problems encountered by the company  57

Table 4.1.8:    Comparison between budget and

                     Performance                                             58

Table 4 .1.10:Budget deviation                                       59

Table 4.1.11:  Solutions to the problems                          59

Table 4.1.12:  Agreement with the performance                60

Table 4.1.13:  If the departments are allowed to exercise

                     control                                                    61

Table 4.1.14:  If utilization of resource achieved with budgeting                      control                                                    62

Table 4.1.15:  The effect of economic recession                 63

Table 4.1.16:  The area of effect                                     64

CHAPTER ONE

INTRODUCTION

1.1 BACKGROUND OF THE STUDY

Business organizations need planning to achieve their aims and objective.

It thorough planning in an organization cannot be done without involving the act of budgeting. The management has the purpose of providing feed-forwarding process.

The concepts of feed-forward process into provide each manager with guidelines for making operation decision on a day-to-day basic.

Budgeting deals with plants and monitoring activities to ascertain whether they confirm to the plan.

This is the control and coordination aspect of budgeting.

       Manufacturing industries can only achieve profit maximization by proper planned use of available resource.

       This is sustained when different activities are efficiently coordinated and decisions taken in the organization are result oriented.

       Business organization requires the use of some techniques in the formula and adoption of planned and defined system and tools with a view to achieve set goals. Such tools and system include budgeting variance analysis and budgetary control. The process of setting goals to be achieved in the future time and determining this planning into financial target can be described as Budgeting.

       Reg, H. Garrison, in his opinion, defined budget, thus, a budget is a detailed plan showing how resources will be required and used over some specific time interval. It repented a plan for the future expressed in a formal qualitative terms. The out of preparing a budgeting control,

       This project is organized in five chapters, which aimed at finding out the budget process used achieving the goals of a typical. Manufacturing, industry with profit maximized as its main objectives with centre focuses in Nigerian Breweries Plc, Enugu

       Chapter one is an introduction to the study concerning such issues as:

1.  Statement of problem

2.  Purpose of the study

3.  Statement of hypothesis

4.  Research question

5.  Scope and limitation of the study

6.  Definition of terms

Chapter two present the literature review which such issues as:

1.  Definition of budget

2.  Feature and function of budget

3.  Preparation of budget

4.  Types and methods of budget

5.  Planning function in an organization

6.  Problems associated with budget

7.  Controlled function in an origination

8.  Budget control and analysis of variance.

Chapter three presents the research design methodology

The source of data collected for analysis and treatment of some of the problem encounter during data collected were examined and analysis in details to enable us draw conclusion there by making recommendation.

1.2     STATEMENT OF PROBLEM

This management has his primary duty of achieving the objective of profit maximization of the company through budgeting due to the state of our economy and government policies this goal is much hindered during the period of economic depression which features low capacity utilization, high interest rate shortage of foreign exchange to buy the needed raw materials.

Management is filed with the problems of how to make use of available scarce resources your order to achieve the objective of profit maximization.

This research work will provide solution of the following problems.

1.  Inability of the manufacturing company objectives

2.  Insufficient appraisal of the company performance base on budgeting.

3.  Inability of officer in the cost centers to confirm to guide line and attain the standard set in the organization. This is application to all works.

4.  Inadequate monitory of compliance with and deviation from department and enter budgets.

1.3     OBJECTCIVE OF THE STUDY

The purpose of this study includes the following:

1.  To show the importance of in getting as a tool for planning and controlling in the operations of a manufacturing industry which as the maximization of profit and  its  principal objectives.

2.  To identify the procedures adopted in the formation and implementation of animal budget in Nigeria Breweries Plc, Enugu.

3.  To determine whether there is a correction between the type of budget implemented and their actually performance.

4.  The study will determine whether or not budgeting control as a management tool contributes to the improvement of managerial efficiency and high productivity.

1.4     STATEMENT OF THE HYPOTHESIS

The following are the basic for research in this study:

HI: Managers are using budgeting planning and controlling the business resource.

HO: Managers are not using budgeting in planning and controlling the business resource.

HI: Budgeting is a tool for effective decision making in manufacturing industry.

HI: Utilizations of resource is achieved with the use of budgeting and budgetary control

HO: Utilization of resources is not achieved with the use of budgeting and budgetary control.

1.5     RESEARCH QUESTION

1.  How does managers use budgeting in planning and control in author the goals of a business?

2.  How does decision making performed in a manufacturing industry using budgeting as a tools for planning and control?

3.  How has utilization of resources achieved with the use of budgeting and budgetary control.

1.6     SIGNIFICANCE OF THE STUDY

In the business world the main objective is to maximize profit by providing goods and services of fair, comparative and affordable price no management can ignore profit maximization unless it will be stifled out of business.

Hence, this study is significant with the following reason?

1.  The study will determine whether budgeting as a tool for planning and control played and significant role towards ensuring portability and efficient rendering of goods and services.

2.  Ascertain the role play by the management in budgeting and whether they ensure to the budget.

3.  Ascertain the role of budget as a tool for effective and efficient utilization of scare resources.

4.  The study will help future researcher on budgeting and budgetary control with emphasis on manufacturing industry.

1.7     SCOPE OF THE STUDY

The study of budgeting as a tool for planning and control in a manufacturing industry has its scope limited to Nigerian Breweries (NBL) Plc Enugu due to various constraints.

       Among the major constraints is the fear of job security by some staff of the company might be unsafe if they grant interviews.

Again, funds available to the researcher and cost of printing the questionnaire to and from the respondents.

       Moreover, there was retaining of time so as to come other course within the limited time.

1.8     DEFINITION OF TERMS

1.  A BUDGET: The institution of cost and management accountant defines budget as a plan quantified in monetary terms, prepared and approved prior to a define period usually showing planning income to be generated and or expenditure to be incurred during that period and the capital to be employed to attain that objective.

2.  Budgetary control: This is the different between planned (budgeted and actual result cost). This may be favourable where actual cost is less than a standard (budget) cost. If it unfavourable where actual cost is greater than standard (budgeted) cost. Alternative terms are minus or plus variance respectively.

3.  Organization: This is all establishment whether government or private owned.

 

Download Budgeting As A Tool For Planning And Control In Manufacturing Industry Research Materials

Share On Social