A budget (from old French bougette, purse) is a financial plan and a list of all planned expenses and revenues. It is a plan for saving, borrowing and spending.
A budget is an important concept in microeconomics, which uses a budget line to illustrate the trade-offs between two or more goods. In other terms, a budget is an organizational plan stated in monetary terms.
In summary, the purpose of budgeting is to:
- Provide a forecast of revenues and expenditures, that is, construct a model of how our business might perform financially if certain strategies, events and plans are carried out.
- Enable the actual financial operation of the business to be measured against the forecast.
- Establish the cost constraint for a project, program, or operation.
Read more about Budget: Why Do We Produce Budgets?, Business Start-up Budget, Corporate Budget, Event Management Budget, Government Budget, Personal or Family Budget, Budget Types
Famous quotes containing the word budget:
“The United States is the only great nation whose government is operated without a budget. The fact is to be the more striking when it is considered that budgets and budget procedures are the outgrowth of democratic doctrines and have an important part in developing the modern constitutional rights.... The constitutional purpose of a budget is to make government responsive to public opinion and responsible for its acts.”
—William Howard Taft (1857–1930)
“A budget takes the fun out of money.”
—Mason Cooley (b. 1927)
“We might come closer to balancing the Budget if all of us lived closer to the Commandments and the Golden Rule.”
—Ronald Reagan (b. 1911)