1.2 Individual budgeting and financial planning

Question 1

Why do the government publish an annual budget?

Answer 1

To show an estimate or forecast of the income from taxation that it expects to receive over the coming year and what it expects to spend

Question 2

Budget

Answer 2

An estimate of income and expenditure for a set period of time

Question 3

cash flow forecast

Answer 3

estimate of the amount of money you expect to flow in and out of your business

Question 4

If an individual appears to be heading towards a deficit in their budget, they can take steps such as:

Answer 4

• reducing planned expenditure
• increasing income
• using an overdraft