Budget
Categories: Company Management, Accounting, Metrics
A budget is that thing you throw right out the window just before you start doing all of your Christmas shopping.
But generally…it’s a plan that lets you see where your money will be spent.
If you have a personal budget, you'll be able to decide ahead of time how much money you'll spend on clothes, food, and megaphones to annoy and anger your neighbors...whatever floats your boat. If you own a company, you might have a much more complicated budget for things like advertising and lawyer fees. Either way, the plan helps you make sure that you have enough moolah for everything you need…and maybe some left over for stuff you want.
Example.
Joan wants to control her money, so she decides to set up a budget for next month. Now Joan knows exactly where every penny is going to go. She’s not going to be caught off guard by any surprise expenses. She’s not going to spend $200 on safecracking equipment and then realize she doesn’t have enough left to pay her phone bill.
Although, if she does get hit with some unexpected expenses...hopefully she can just pawn some of those exotic vases she took from the Peterson place.
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Finance: What is a Budget?43 Views
Finance a la shmoop what is a budget? that's that thing you throw right out [Woman throws budget out the window]
the window just before you start doing all your Christmas shopping
right but generally it's a plan that lets you see where your money will be
spent if you have a personal budget well you'll be able to decide ahead of time [Personal budget example]
how much money you'll spend on clothes, food, megaphones to annoy and anger your
neighbors and you know whatever floats your boat if you own a company well
you'll probably have much more complicated budget for things like
advertising and lawyer fees either way the plan helps you make sure that you
have enough moolah for everything you need and maybe some leftover for stuff
you want.....Joan wants to control her money so she decides to set up a budget for [Joan setting up a budget on a laptop]
next month she makes a thousand bucks from her summer job and well here's what
her budget looks like.....
Now Joan knows exactly where every penny is gonna go she's not [Joan driving a car]
gonna be caught off guard by any surprise expenses she's not gonna spend
$200 on safecracking equipment and then realize she doesn't have enough left [Joan stood beside a vault of gold bars]
to pay her phone bill although if she does get hit with some unexpected
expenses well hopefully yeah she can just pawn some of those exotic vases she
took from the Peterson place [Joan holding a vase]