Budgeting and Budgetary Control Flashcards
What is Budget?
A plan for the future and identifies how the business plans to spend its revenue and how the expenditure will be financed
What will Budgeting do?
Budgeting will identify if the business can just continue as it is or whether it needs to review sales or costs.
Identifies if the business is in a position to make changes or expand.
What is an Expenditure budget?
It is an estimate of all the planned business costs for a set period of time.
What will a Revenue budget do?
It will estimate how much money the business will expect or want to make from sales over a set period of time.
What is Budgetary control?
It is just a review of whether the business has achieved its goals.
What will the Budgetary control do?
Budgetary control will compare the business’s actual performance against the planned target performance and when the business has not achieved its planned targets, it may need to take corrective actions.
What is the purpose of Budgetary control?
It will help the business achieve their objectives.
