- Writing a Business Plan
- Financial Statements
- Business Forecasting
- Business Checklist
University Advertising Expense - from Operating Expense Budget
Since Murray's product is a listing of organizations who "give" scholarships to university students, it would seem only natural to advertise in University Newspapers. After contacting several universities newspapers, he discovered it will cost him approximately $100.00 per advertisement. After a great deal of analysis, Murray decides he will buy 20 university newspaper advertisements in September, October, November, and December of 200X. As a result, $2,000 will be spent in each of these months (20 advertisements x $100 per advertisement). Therefore, his total University Advertising Expense for 200X will be $8,000 ($2,000 per month x 4 months). The total University Advertising Expense of $8,000 will appear on his 200X Forecasted Income Statement. In addition, Murray's Forecasted Cash Flow Statement will show a Cash Outflow of $2,000 in September, October, November, and December of 200X for University Advertising.
In 200Y, Murray intends to buy only 15 university newspaper advertisements per month in eight of the twelve months; namely, in January, February, March, April, September, October, November, and December. Therefore, he will spend $1,500 in each of these months ($100 per advertisement x 15 advertisements). His total University Advertising Expense for 200Y is expected to be $12,000 ($1,500 per month x 8 months). The $12,000 will appear on his 200Y Forecasted Income Statement as "University Advertising Expense". The 200Y Forecasted Cash Flow Statement will show a Cash Outflow of $1,500 in January, February, March, April, September, October, November, and December for university advertising.