What is the main purpose of budgeting?
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Budgeting plans and controls financial resources to meet organizational goals.
What is rolling forecasting?
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A continuous forecasting method that updates budgets regularly.
Which budgeting method allocates resources based on last period?
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Incremental budgeting adjusts previous budgets slightly for the new period.
What is a forecast in financial planning?
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A prediction of future financial results based on data and assumptions.
Why is variance analysis important?
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It identifies differences between budgeted and actual performance.
Which tool is often used for financial forecasting?
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Excel is widely used for building financial forecast models.
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What does flexible budgeting allow?
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Adjusting budgets based on changes in activity or volume.
What is a budget variance?
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The difference between planned budget and actual spending or revenue.
Why is forecasting important for businesses?
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It helps anticipate financial needs and make informed decisions.