Budgeting and variance

Question 1

What are 2 quantitive factors when looking for finance

Answer 1

1. How much debt do we already have

2. Exactly how expensive is this source of finance

Question 2

What is a qualitative factor when looking for a source of finance

Answer 2

1. Do we remain in complete control of the business and the finance

Question 3

Define what a budget is

Answer 3

A budget is allowing a set amount of money each month for various expenses

Question 4

Define what variance is when talking about budgeting

Answer 4

Variance is where there is a difference between planned budget and the actual outcome of the budget

Question 5

Define the two types of variance

Answer 5

1. Positive variance - when you come in under budget

2. Negative variance - when you come in over budget