R.H Buis 3 (Budgeting)

Question 1

Budgeting

Answer 1

The process of planning income and expenditure withing a business

Question 2

Budgeting control

Answer 2

The process of checking what is actually happening compared to the plan

Question 3

Cash inflow

Answer 3

The amount of money entering a businesses bank account

Question 4

Cash outflow

Answer 4

The amount of money leaving a businesses bank account

Question 5

Net cash flow

Answer 5

The difference between the cash inflow and outflow over a period of time.

Question 6

Cash balance

Answer 6

The amount of money left in the bank after the net cash flow has been added or subtracted

Question 7

What are the Motives behind setting budgets ?

Answer 7

> helps to improve control and monitoring of a businesses activity
helps a business to anticipate problems and their solutions
helps business coordinate its activities
helps business communicate its objectives to staff
improves efficiency in decision making
motivator to staff and management

Question 8

Net profit (operating profit)

Answer 8

the actual profit after working expenses not included in the calculation of gross profit have been paid.

Question 9

Income is also known as

Answer 9

Revenue