Question

1. What are some examples of administrative departments?

2. What is a Headcount Forecast Algorithm and what is its primary use?

3. Why is historically information particularly useful in creating a General and Administrative Cost

budget?

Answer 1

1. Administrative departments are the support system in the organisation. They support thhe primary departments in day to day activties. A few examples of administrative department include

• Human Resourcs
• IT
• Business Administration
• Finance

2. Headcount Forecast Alogorithm is a method used for forecasting head count. This methods helps in determining the additional staffing requirements of indirect product specialists or heads. It also helps in managing and controlling the indirect cost and improve productivity.It is simple, easy to understand and realistic method.

Headcount Forecast =

3. While creating a General and Administrative Budget, historical information is useful to forecast the future expenses. Based on the actual expenses incurred in the past one can determine the what kind of costs will be incurred and the amount of cost that will be incurred after taking into consideration inflation. Based on the historical information goreasting can be done as close to and realistically as possible to arrive at the budget numbers.