budgets 0.0 / 5 ? Business StudiesFinancial PlanningASEdexcel Created by: aleyshea darCreated on: 05-03-16 18:56 budget a financial plan estimating costs and revenue, enabling comparisons with actual data later 1 of 12 variance the difference between the budgeted figure and actual figure 2 of 12 favourable a better actual figure than budgeted 3 of 12 adverse a worse actual figure than budgeted 4 of 12 extrapolation using previous years data and assuming that past trends will continue in the future 5 of 12 zero based budget budgets start with no assumptions based on experience. managers are asked to bid for funds and negotiate on an agreed budget 6 of 12 advantages of budgets budgets set targets, so motivate staff 7 of 12 advantages of budgets budgets can identify loss making areas in the business 8 of 12 advantages of budgets banks/lenders may want to see/monitor budgets before lending money 9 of 12 disadvantages of budgets budgets can be hard to plan without historical data 10 of 12 disadvanatges of budgets budgets are an estimate and are not 100% accurate 11 of 12 disadvanatges of budgets changing economy, trends, competition can affect actual figure in a budget 12 of 12
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