budgets Flashcards
(7 cards)
1
Q
what is a budget
A
a financial plan that is agreed in advance
2
Q
what is a historical budget
A
a budged based on previous annual figures
3
Q
what are the disadvantages of historical budget
A
prices may change overtime therefore the figures are not accurate
4
Q
what is a zero based budget
A
Involves creating a budget with all spending justified to ensure value for money
5
Q
what are the advantages of zero based budget
A
can help to minimise costs
6
Q
what are the disadvantages of zero based budget
A
can be time consuming
7
Q
what does variance mean
A
the difference between actual financial outcomes and those budgeted
