Developing the Budget on Computer Spare Parts Patrick works for McGill’s Computer Repair, owned and operated by Frank McGill.
As a computer technician, Patrick has grown accustomed to friends and family members asking for assistance with their personal computers. In an effort to increase his income, Patrick started a personal computer repair business that he operates out of his home on a part-time basis, working evenings and weekends.
Developing the Budget on Computer Spare Parts
Because Patrick is doing this ìon the side for friends and family, he does not want to charge as much as McGillís charges its customers. When Frank McGill assigned Patrick the task of developing the budget for his department, Patrick increased the amount budgeted for computer parts. When the budget was approved, Patrick purchased as many parts as the budget allowed, even when they were not needed. He then took the extra parts home to use in his personal business in an effort to keep his costs down and profits up. So far, no one at McGill has asked about the expense of the parts because Patrick has not allowed the actual amount spent to exceed the budgeted amount.
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