Controling - Admission/Application Essay Example

Grade Controlling Question Businesses are striving to outdo one another in order to remain competitive. One approach that can be used is to adopt wise use of budget and budgetary control mechanisms which can enhance performance if creatively used. Budgeting ensures that resources are allocated to accomplishment of certain goals and objective. Controlling the same is important as it ensures that deviations are identified and corrective measures are taken (Sheffrin 123). At Earthbound trading company, budgets are prepared once every financial year.

Every department draws their own budget then he same are extensively discussed together with the finance department and the top management of the company. Once approved, each department is then allocated the funds. It is the responsibility of the line managers or supervisors to allocate and oversee that the duties and responsibilities indicated in the budget are attained. Periodically, the line supervisors with the head of departments meet to evaluate the results obtained so far against the budget as well as the standard performance (Sheffrin 510).

Where there are deviations, strategies are adopted to correct the problem. For instance, if it has been realized that there is need for more workers, the department is allowed to outsource services. The company through the process has realized a number of advantages such as improved allocation of scares resources, enhanced communication, and motivated workers since the process calls for participation among others. Question 2Earthbound Trading Company has realized that financial Control is one approach that can help it survive and continuously grow in the present world of business.

Ideally businesses need to control financial resources at their disposal. Earthbound Trading Company financial resources include revenue generated, shareholders’ investment, detained earning, and working capital among others. The company has adopted a number of approaches such as financial statements, ratio analysis and break-even analysis to accomplish financial control. In order for a firm to make strategic decision, financial statements are used. The greatest advantage of using this approach is that it shows the budget, however, the data obtained from the statements can be outdated based on the changes in the market pattern.

Ratio analysis is another technique that is being used by the company. It is a summary of financial statement; it can offer information to compare firms of as well as doing trend analysis. However, it not important in predicting the future since it reports on what happened. For the new stores, the company usually applies break-even analysis to determine when the subsidiary will be able to cover its expenses and make profit. It is simple to compute and understand. Similarly, it can deal with the changes in the business environment.

However, it assumes that the products are sold at the set price which in most cases is not true (Sheffrin 500). Work CitedSheffrin, Steven. Economics: Principles in action. Upper Saddle River, New Jersey: Pearson Prentice Hall, 2003. Print.