5.3 My LC (Learning Consultants)’s Master Budget

In accordance to the concerned topics, I choose to take the topics of my ongoing educational works. I have been running an educational service provider - Learning Consultants (LC) for two years. So far, my first purpose on establishing the LC is to happily contribute to the people’s education. I span the digital based platform in collaboration with youtube, blogspot, and wordpress. In the future, I  want to build my own in house built websites or even the use of google domain and premium blogspot or wordpress as well as constructing physical building for the institution. In the two years run of LC, I don’t think about how profitable I will be. I just think to share values to all people. This results in unsustainable activity in the future. Therefore, I choose to create subsidized educational service accessible for all people. For this reason, I need to create the well-established LC’s master budget.

The process to create the LC’s budgets begin with the first quarter of yearly project of university entrance exam preparation of all senior high school students in an event namely Ciamis Learning Camp (CLC). The budget of the next quarter can be taken as other periodic educational activities for long term preparation or other educational programs. As the first quarter project, it was established as a non-profit organizational project. In the future, we consider to generate profit by taking educational fees for high economy students to be given as subsidized scholarships for basic needs of all students and learning facilitators. As the first quarter project, the budgeting process start with the review of last year’s data which is considered to be critical for the expenditures of legal authority sponsors (Heisinger, & Hoyle, (n.d.)). Last year the YBMPLN as a CSR of our national electrical company was the only sponsor for the event. The sponsor gave us the total amount of about Rp. 20000000 (twenty million rupiah) or around $ 1409.34395 for a quarter social educational project. Other unseen assets considered as profitable in the future are the number of social media subscribers. Currently, the LC’s youtube subscriber is 266. Fb page is about 285 and Ig follower is 184. The number of youtube subscriber is targeted to be at least 1000 to generate advertising based revenues. Further aspiration is the available android and web based application for future educational activities.  In detail, some important points of master budget calculations can be given in the following table,

Table 1 : LC (Learning Consultanst)’s Budgeted income statement

Based on the master budget, we recognized the CLC project start in the first quarter from January to April. This is well chosen since we know the university entrance exam is usually nationally held in May. In the first quarter, all sponsor funds with the amount of Rp. 20000000 are fully given to 20 best students @ Rp.1000000 to improve their achievement, to teach other students and to motivate them for getting the admission. For that quarter period, the net income is supposed to be Rp. 40720400 if the total number of targeted registered students reach 15000 persons paying the cost of the cheapest ticket of Rp. 12000. In the second to fourth quarter, available students are the ones doing long time preparation for university entrance, school, or TOEFL exams. In each three quarter, the targeted registration is to reach 5600 persons @Rp. 25000 giving net income of Rp. 720400 for quarter 2 to 4 and Rp. 42881600 that year.     

Based on comparison of the above data to the previous master budgets of the manufacturing companies. The master budget of general service such as educational service provider are different. As we were concerned with the Krakatau Steel Inc as one of the government owned manufacturing companies which produce diverse steel products, My LC (Learning Consultants) as one of the privately owned companies provide educational service instead of seen object as branded products. In generals, principal differences can be seen in the cost calculations of sold products or services which can be seen in the following illustration (Anonimous, n.d.),

Sevice company	Manufacturing company
Provided service cost	Manufactured product cost
Overhead and labor costs in primary	Overhead, labor and materials
Online or digital learning inventories such as android and web based	Real building inventories

 

References

Heisinger, & Hoyle. (n.d.). Budgeting in Nonmanufacturing Organizations. Budgeting in nonmanufacturing organizations. Retrieved October 7, 2021, from https://2012books.lardbucket.org/books/accounting-for-managers/s13-04-budgeting-in-nonmanufacturing-.html. 

Anonimous. (n.d.). Manufacturing, Merchandising and Service Companies. Managerial accounting. Retrieved October 8, 2021, from http://www.csun.edu/~hfact004/Managerial.html.