Setting Budgets Flashcards Preview

Planning and Financing A Business > Setting Budgets > Flashcards

Flashcards in Setting Budgets Deck (7):
0

Income budget

Specific type of budget showing how and where money is earned in a business

1

Expenditure budget

How much a business should spend

2

Costs found in an expenditure budget:

Labour costs
Rent
Capital costs

3

Profit budget

Income budget- expenditure budget

4

Planning a budget

1: set objectives
2: market research
3: research costs
4: complete sales/income budget
5: construct expenditure budget
6: construct profit budget
7: summarise statements in master budget.

5

Reasons for setting budgets

-to gain financial support(bank managers want to see a budget)
-encourage delegation
-priorities, large budgets for important activities

6

Problems in setting budges

-unforeseen changes
-time consuming
-gathering info difficult for start ups