Budgets key words

Question 1

Budget

Answer 1

a quantitative economic plan prepared and agreed in advance

Question 2

Budgetary control

Answer 2

a business system that involves making future plans, comparing the actual results with the planned results and then investigating the causes of any differences.

Question 3

Historical figures

Answer 3

quantitative information based on past trading records.

Question 4

Production cost budget

Answer 4

a firm’s planned production costs for a future period of time

Question 5

Sales budget

Answer 5

a firms planned sales for a future period of time - can be measured in terms of volume or revenue

Question 6

Variance

Answer 6

the difference between actual financial outcomes and those budgeted.

Question 7

Variance analysis

Answer 7

the process of calculating variances and attempting to identify their causes.

Question 8

Zero - based budgeting

Answer 8

a system of budgeting where no money is allocated for costs or spending unless they can be justified by the fund holder ( they are given a zero value).