Chapter 12 – Budgeting and Performance Measurement
12-11
Ch. 12, Solutions, 12–16 (Cont’d)
d. Based upon the information provided, the town presently uses incremental
line-item budgeting, probably organized along departmental lines. Although
the new town manager’s effort to impose zero-based budgeting discipline into
General Problem Information: Police department budget
Learning Objective: 12-1
Topic: Objectives of Budgeting in the Public Sector, Budgeting Process in a State or
Local Government
Bloom’s Taxonomy: Apply
Accreditation Skills tag: AACSB: Knowledge Application, AICPA: Critical Thinking
Level of Difficulty: Hard
12–17.
a. Average city tax bills have increased approximately 11% or $131 over a two-
year period. The areas of greatest percentage increase have been the KP&F
Chapter 12 – Budgeting and Performance Measurement
12-12
Ch. 12, Solutions, 12-17 (Cont’d)
b. As would be expected at the city government level, most revenues come from
taxes (state and local, property, motor vehicle, and other) and user licenses
and fees. The greatest expenditures for Manhattan are related to utilities,
c. Answers will vary according to individual preferences and the number of other
budget documents that the students have examined.
General Problem Information: Illustrations within a budget document
Learning Objective: 12-1
Learning Objective: 12-3
Topic: Objectives of Budgeting in the Public Sector, Budgeting Process in a State or
Local Government
Bloom’s Taxonomy: Apply
Accreditation Skills tag: AACSB: Knowledge Application, AICPA: Critical Thinking
Level of Difficulty: Easy
Chapter 12 – Budgeting and Performance Measurement
12-13
Ch. 12, Solutions (Cont’d)
12–18.
a. The first performance measure that the City of Ashcroft’s library lists is
authorized full-time positions. The eight staff members who work in the
library can be considered input to the operations. In a narrative titled “Library
b. Efficiency measures are usually presented as a ratio; for example, dollars
c. A citizen’s perceptions or feelings are based on more than just reported
statistics; however, a review of the statistics presented in the SEA report
Chapter 12 – Budgeting and Performance Measurement
12-14
Ch. 12, Solutions, 12–18 (Cont’d)
General Problem Information: SEA Reporting
Learning Objective: 12-4
Topic: Service Efforts and Accomplishments
Bloom’s Taxonomy: Apply
Accreditation Skills tag: AACSB: Knowledge Application, AICPA: Critical Thinking
Level of Difficulty: Medium
12–19.
a. The primary activities of the Orangeville Animal Control Program are
complaint response, impounding of dogs, care of dogs that are returned
Activities, Resources, and Cost Drivers
Activity #1:
Responding to a complaint
Resources required:
Program director
Labor (animal control wardens)
Specially equipped vehicles
Cost driver:
Number of complaints
Activity #2:
Impounding an animal
Resources required:
Labor (animal control wardens)
Specially equipped vehicles
Cost driver:
Number of animals impounded
Activity #3:
Care of impounded animal returned to its owner
Resources required:
Contract-specified fee
Cost drivers:
Number of animals impounded
Length of stay at kennel
Activity #4:
Care of an impounded animal that is adopted
Resources required:
Contract-specified fee
Cost drivers:
Number of animals impounded
Length of stay at kennel
Chapter 12 – Budgeting and Performance Measurement
12-15
Ch. 12, Solutions, 12–19 (Cont’d)
b. When answering this question, it is important to recognize that many
factors constrain what solutions can be implemented. Public relations,
humanitarian, political and regulatory considerations exist; for example,
the Orangeville community or the service provider may not accept the
Chapter 12 – Budgeting and Performance Measurement
12-16
Ch. 12, Solutions, 12-19 (Cont’d)
Activity #4—care of an impounded animal that is adopted—As with
Activity #3, most of the cost associated with this activity results from
the cost for the animal’s stay at Donna’s Kennels. Since this cost is
General Problem Information: Activity-based costing
Learning Objective: 12-5
Topic: Managerial Tools to Improve Performance
Bloom’s Taxonomy: Apply
Accreditation Skills tag: AACSB: Knowledge Application, AICPA: Critical Thinking
Level of Difficulty: Hard
Chapter 12 – Budgeting and Performance Measurement
12-17
Ch. 12, Solutions (Cont’d)
12–20.
a. Citizens are typically most concerned with response times, and the City
of Greeley’s fire department has overall EMS and fire average response
rates close to the five minute mark for the past several years. As a
comparison; however, the EMS response appears a bit better than the
fire response, it is well below 5 minutes on average – in fact it is below
b. The City of Bellevue’s fire department provides far more performance
measures than are presented here for the City of Greeley, making it
difficult to compare the performance of the fire departments. Both utilize
General Problem Information: SEA Reporting
Learning Objective: 12-4
Topic: Service Efforts and Accomplishments
Bloom’s Taxonomy: Apply
Chapter 12 – Budgeting and Performance Measurement
12-18
Ch. 12, Solutions, 12–20 (Cont’d)
Accreditation Skills tag: AACSB: Knowledge Application, AICPA: Critical Thinking
Level of Difficulty: Medium
12–21.
1. A, Section 200.461
2. N, Section 200.423
5 – Recruitment costs are allowable provided that the size of the staff
recruited and maintained is in keeping with workload requirements, costs
of ‘‘help wanted’’ advertising, operating costs of an employment office
Chapter 12 – Budgeting and Performance Measurement
12-19
Ch. 12, Solutions, 12–21, (Cont’d)
6 – While dependent care costs are generally not allowable, Section
200.474 (c)(1) specifies that temporary dependent care costs above and
General Problem Information: Allowable Costs under Federal Grants
Learning Objective: 12-6
Topic: Budget and Cost Issues in Grant Accounting
Bloom’s Taxonomy: Apply
Accreditation Skills tag: AACSB: Knowledge Application, AICPA: Critical Thinking
Level of Difficulty: Hard