buss 2

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using budgets- a budget is a financial plan for the future concerning the revenues and costs of a business over a given period of time.

why are budgets used:

  • established priorities and sets out targets
  • provides direction
  • assign responsibilities
  • allocate resources
  • delegate without loss of control
  • motivate staff
  • monitor performance
  • contropl revenues and costs
  • communicate

Historical budgeting:

  • using last years fingures as a basis for the budget
  • realist and based on actual results
  • circumstances may have changed
  • doesnt encourage efficiency

zero-based budgeting :

  • budgeting costs and revenues are set at zero
  • budget is based on a new proposals for sales and…


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