Question

The government works and the nationalized industries are regarded as the most appropriate for lending money as their assets are more productive and will get sufficient revenue to cover the cost. The government provides general economic welfare by providing freeways, fly over bridges, and other infrastructure facilities. Although there is no marketplace in which the output of government action is vended and there can be no goal to test the action’s value. On the other side of the coin, the lending to private businesses is completely dependent on the capabilities and performance of their business. The performance is usually monitored by the budgets prepared by the organization. the private business prepares its budgets to measure the performance against expenditure and make sure that their resources are available for the development of their business. Budgets are very crucial for planning and control of the money used in the business. The budgets enable the owners to focus and cash flows, costs, and increase their returns.

Answer the following:

Discuss how government budgets are different from the budgets of a business organization. Explain with the help of a sample government budget and a sample budget of a private business

Answer 1

Government budget.	Business budget.
usually, the budget are very big and are used on several levels. from central authority to federal and local level.	financial statements of companies are smaller than that of government. if the company have two or more branches than they usually provide the fund on the bases of profit.
expenditures are social in nature. the government has to spend its money on welfare works. built roads, bridges, schools, hospitals, and other such institutions. this expenditure is a must condition. the government has to spent this amount for its running system and for this government have to initiate schemes in a long term without any expectations of profit.	the business budget has a very different approach. they divide the revenue according to the profit they get. they also long and short term goals with expenditure but companies spends money for limited thing like expand of production with grate profitability, salaries for employees, and for other such things that help them in the market to expand.
government finances are usually fixed and rigid in nature. once they get approval fro authorities, the money must come in the cycle. the chance of divergence of fund is very rare.	fund allotment or the profit-sharing in business has two parts, one is the compulsory and other is non-compulsory or experimental. the compulsory expenditures are like salaries and other capital maintenance expenditure, and the non-complusory fund is used eventually for the expansion of the company, any new initiative which earns more profit and other like opening any other branch for better performance of the company.
let's take an example of the US government. government financial statement came every year which allots funds for different sectors like social security. defence, and industry this year budget is about 4.8 trillion dollar of which 60% cover secret like mediocre, supplements nutrition, assistance programme and other social security.	the annual expenditure of company like INFOSYS, cover terms like row material consumed, pays of employees, texas, power and fuel, depreciation cost and many more. so the difference is very high. the company make financial statement for-profit and spend accordingly.