701839
Description
Mind Map by jack.miers, updated more than 1 year ago
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Created by jack.miers
about 10 years ago
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Finance Unit - Budgets
- DEF: A budget is a financial plan that sets targets based on projected costs and revenues
- Types of Budgets
- Income budget
- expenditure budget
- profit budget
- Income budget
- BENEFITS of using budgets:
- - can measure performance
- - can improve motivation
- -progress monitoring
- -progress monitoring
- - can improve motivation
- - can measure performance
- DRAWBACKS of using budgets:
- - new business's lack experiance in setting realistic budgets
- Costs are volatile and can change quickly
- Costs are volatile and can change quickly
- - new business's lack experiance in setting realistic budgets
- Variance analysis-
- Favourable variance
- Actual costs are lower than budgeted figures
- Adverse variance
- costs are more than budgeted
- costs are more than budgeted
- Favourable variance
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