Discover the main types of business budget

[asadul5585]

Entrepreneurs know that maintaining an active and healthy business is a huge challenge. Especially in the current scenario, where the market is often uncertain and complex, having a financial forecast is essential, as it is with this that you will have support to deal with situations that may arise, whether expected or unexpected. With this in mind and to help you with your financial management, we have brought the main types of business budgets used in the market, so that you can understand possible future contexts, capable of supporting more assertive decisions. What is a business budget A business budget is an important tool that shows a company's financial situation . When used correctly, it is a true guide for anyone who needs to manage a business. It is a document that can be drawn up every month or annually, depending on the type, and includes all sources of income, fixed expenses and variable costs - which are different things.



By looking at it, you can also foresee a reserve for emergency expenses - a situation from which no one is free. It's about having financial control of the present scenario to plan the future with greater security. E-book achieving zero default What are the main types of budget To help you create your budget, we have listed the seven main types of business budgets. Check it out below! 1. Static budget As the name suggests, this type of budget does not change during the process. This means that what is Kuwait Mobile Number List defined at the beginning, ends exactly as it appears in the document, without changes, until the next budget is defined. Small companies usually opt for this type because it focuses on a single action or activity. It helps in quickly understanding failures, facilitating adjustments and leading to better decisions. 2. Flexible budget The difference between static and flexible budgets is that here autonomy is allowed to adjust it, depending on changes in context. A flexible budget is based on unit rates. It is possible to use, for example, the relationship between the number of products available for sale and the output of each one.






Based on the analysis of this data, business management shapes this budget, which is why it is flexible. It is a great tool for controlling operational and manufacturing costs, unlike static, which is more suitable for administrative functions. 3. Ongoing Budget If you want to cover a year of planning, but without forgetting to constantly review what was planned in the business plan, using the continuous budget is a good idea. You can do monthly, quarterly or semi-annual reviews, for example. This way, it is possible to evaluate successes and mistakes and, based on this observation, make the necessary adjustments. Companies that need agility to make decisions and project new budgets, based on results, are better suited to this option. 4. Adjusted budget Also flexible to changes, as is the case with the previous budget, the adjusted type leads the company to study which practices generate profit and which generate expenses. This is why this analysis can lead to change. These studies are usually carried out monthly, generating changes to the original project budget. In other words, it can be modified whenever necessary.