PAD525 Week6 Assignment2
PAD525 Week6 Assignment2
Popular in Course
verified elite notetaker
Popular in Department
This 8 page Study Guide was uploaded by kimwood Notetaker on Friday November 6, 2015. The Study Guide belongs to a course at a university taught by a professor in Fall. Since its upload, it has received 19 views.
Reviews for PAD525 Week6 Assignment2
Report this Material
What is Karma?
Karma is the currency of StudySoup.
You can buy or earn more Karma at anytime and redeem it for class notes, study guides, flashcards, and more!
Date Created: 11/06/15
CITY OR RICHMOND CAPTIAL CAPITAL BUDGET 1 CITY OF RICHMOND, VIRGINIA CAPITAL BUDGET Week 6 Assignment #2 Joseph Brown Dr. Udoh E. Udom PAD505 May 19, 2013 CITY OR RICHMOND CAPTIAL CAPITAL BUDGET 2 Introduction to Capital Budgeting Capital budgeting is the procedure on how to organize an organization performance through the use of machineries and equipment to ensure that the agency indeed succeeds in proving public services in an effective manner. The City of Richmond, Virginia has to invest in human resources and also creating research development for its institution to ensure that future expectation of good governance is met. “There are various methods that can be used to perform this technique in various ways. For instance, first is the use of payback period to determine the certainly, or uncertainly” (Clark 1979). The City of Richmond can use payback period analysis to measure and evaluate similar institution works. The timely value of money is not considered while performing this procedure. The formula for calculating it is as follows: The payback period formula is used for quick calculations and is generally not considered an endall for evaluating whether to invest in a particular situation. The result of the payback period formula will match how often the cash flows are received. An example would be an initial outflow of $5,000 with $1,000 cash inflows per month. This would result in a 5 month payback period. If the cash inflows were paid annually, then the result would be 5 years. At times, the cash flows will not be equal to one another. If $10,000 is the initial investment and the cash flows are $1,000 at year one, $6,000 at year two, $3,000 at year three, and $5,000 at year four, the payback period would be three years as the first three years are equal to the initial outflow. CITY OR RICHMOND CAPTIAL CAPITAL BUDGET 3 The second method is the use of accounting rate of return whereby the ratio doesn’t also take into consideration the time value of money it can be used to determine the rate of net income from the capital investment. Its formula is represented as follows: ARR=Average profits / Average investments The other method to use is the use of net present value that is considered and used in all cash flows for future and present cash flows. It is most suited for projects that are long term to measure cash flow and terms of the contracts. The other method is the use of profitability index amongst other methods such as modified internal rate of return amongst others. City of Richmond Payroll Forecast The City of Richmond plan for the salaries of its employees can varies from that of other government institutions. The plan ranges from the upper level management to the middle level of management to the subordinate levels. The Richmond City city’s employee’s payroll can be affected in numerous ways depending on the city revenue and index pricing of consumers goods and services. For instance, the drop in pay reflects the weak employment market in the US across many jobs. A COLA based on the CPI would be overpaying by about whatsoever percentage on average. City governments and others are free to pay above the market price based on internal value. They cannot pay much below the market price for long and keep workers, whether the workers are average or outstanding. Raises, no matter what they are called, are about recognizing changes in market price and/or internal value of a worker. “If there are minimal growths in the company this would mean that the productivity levels in the are low thus the low profit turn out resulting into poor yields in the company annual turnover” (Kaufman 34). Evidently enough, as result of CITY OR RICHMOND CAPTIAL CAPITAL BUDGET 4 increased revenue maximization and growth of the city service, the employees would receive increased pay remunerations for their efforts contributed in the company. The pie chart above shows the allocation of the City of Richmond pay increase in percentage. For instance, under the 2% pay increase it tremendously registered low number of consumer’s index pricing as compared with the 4% and the 5% where it shows much greater amount of consumer index pricing. Alternatively, the 4% pay increase is also less than the 5% pay increase. The 5% pay increase dismally shows the economic is moving. The City of Richmond employee’s salaries at all cost should be sensitive to instill effective growth and the promotion of good governance. As a result of effectiveness and efficiency in the services that the city provides, the employees would be promoted and rewarded for their efforts irrespective of the positions they hold in the agency. The subordinate’s staff could be promoted CITY OR RICHMOND CAPTIAL CAPITAL BUDGET 5 various job group levels different with the ones they had been serving before. For effective agency compensation, the City of Richmond has to properly organize itself to ensure that its total revenue is increased at all costs. If the city increase the rational by 2% it means that the employees ‘salaries would be definitely increased too and if the city also increase the salary by 4% the salaries would still double the 4% of the salary expected by employees. The effects of increased benefit for the City of Richmond lead to various advantages. The first advantage is that the employees would be paid more rewards. The management will also ensure that the employees produce their best while performing various tasks in the institution to ensure that they succeed. This would motivate the employees to produce their best while in the workplace. The city should also ensure that the employees are treated fairly in the institution by providing them with healthy working conditions while performing their duties. This would ensure that they are motivated to perform diligently various tasks allocated to them. City of Richmond Trend Analysis The trend for the City of Richmond has over the years changed depending on whatever the city interests all about. For instance the city should concentrate on the employee remuneration programs and offering training opportunities to these employees to ensure that they do carry out their task in a more professional manner. Also the city should ensure that it does outsource new employees to represent the institution ideas at greater levels that would spearhead growth in its public sphere. CITY OR RICHMOND CAPTIAL CAPITAL BUDGET 6 This graph shows the trend of operation analysis on the services the city of Richmond provides and administers to the public and the expenditures the city incurs. Under each label the City of Richmond resisters diverging series of expenditures that it accrues in the city operations. City of Richmond Expenditure Forecast CITY OR RICHMOND CAPTIAL CAPITAL BUDGET 7 The five years forecast for the City of Richmond in its expected financial years is to ensure that the employees perform to the required standards and levels set by the city. Each of these projects should be able to meet their deadlines and targets set by the management pertaining to goods and services timeline of the city. The city should set its deadline that requires fulfilling in every financial period of the set target. This would also ensure that the city maximizes its revenue instilling of every growth in all the sectors of the economy. The employment opportunity if offers would contribute to stable living standards for its citizens. CITY OR RICHMOND CAPTIAL CAPITAL BUDGET 8 References City of Richmond Budget (20132014). http://www.richmondgov.com/Budget/documents /BiennialPlans/20142015_ProposedBiennialFiscalPlan.pdf Clark. J.J., Hindeland. T. J., & Pritchard. R. E. (1979). Capital budgeting: planning and control of capital expenditures. Englewood Cliffs. N.J.: PrenticeHall. Council meeting of the City of Richmond on Capital Budgeting and Planning. (2009). Citywide Payroll Precess. Richmond, Virginia. Office of City Auditor Services. Public Information Offices. Hearing Unit. Kaufman. M. )1986). The Capital budgeting handbook. Homewood. III.: Dow JonesIrwin. Wilkes. F. M. (1977). Capital budgeting texhniques. London: Wiley.
Are you sure you want to buy this material for
You're already Subscribed!
Looks like you've already subscribed to StudySoup, you won't need to purchase another subscription to get this material. To access this material simply click 'View Full Document'