In: Accounting
discuss the purposes of budgeting process.
Budgeting process is very crucial and Important for any business entity or any house holds . Without a proper budget, a business can never keep track of how much it has earned and how much it has spent.and in a house hold it is also very important because funds are limited. Budget serves a great guide by which a business can oversee its income stream and can identify potential dangers to it beforehand. Furthermore, budget acts as a valuable tool in order to take control of how a business/house hold spends. A budget makes sure that all the money is being spent in the right direction and financial goals are attained.
Purpose:
Manage funds
Reduce unnecessary expenses
For make decision easy and fast
For forecast
For decide responsible department or person
For cost control
Right and best use of sources
Determine capital requirement
Useful for decide mathod of accounting
Find Reasons of failures
Decide plan for near future
For grow business
Manage house holds