Briefly discuss the budgeting process

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Expert Solution

Budgeting process is the future planning of income and expenditure in order to streamline the expenditure process. In business, it serves as a monitoring and controlling method to manage the finance efficiently.

Steps in budgeting process are -

1. Make realistic goals - To make smart spending choices one should make or set goals for the finance.

2. Calculate your earnings - To identify your income and expenses you should find out how much you earn each month and where it all goes.

3. Separate needs and wants - For this, set the clear priorities for the business and the decision become easier to take.

4. Make your budget - Here, balance your budget to accommodate everything you need to pay for. Make sure that you are not spending more than you make.

5. Put your plan into action - This is the step where physical action is done. Make your spending to when you receive your income.

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