3.9 Budgets & Budgeting Vocab (HL)

A detailed financial plan for the future

• Variance Analysis

• Budgetary Control

• Financial Strategy

• Budget

Budgeting is the process of creating, maintaining, or analyzing a budget in order to reduce _____________ and improve _____________

• Risk, Decision Making

• Outflows, Inflows

• Profits, Strategy

• Costs, Strategy

The budgeting "process" includes all of the following except:

• Planning

• Setting

• Delegating

• Monitoring

• Controlling

When the responsibility for budgetary control is given to less senior management

• Delegated Budget

• Budget Process

• Incremental Budgting

• Budgetary control

The "budget process" is the series of stages or steps taken to ensure the budget is effectively planned, reviewed, and adjusted.

• True

• False

Type of budget in which the previous year's budget is is used as a baseline for a general increase or decrease in the budget for the coming year.

• Zero Based Budget

• Incremental Budget

• Standard Budget

• Strategic Budget

The type of budget in which budget holders are forced to provide reasons for why they should receive budgetary funds each year

• Zero-based Budget

• Incremental Budget

• Delegated Budget

• Strategic Budget

A section of business (that may or may not exist physically) for which specific costs can be identified and attributed.

• Profit Center

• Cost Center

• Budget Holder

• Strategic business division

In order for a profit center to be created, a firm must be able to identify both _________ and _________ from the relevant business area.

• Profit and variances

• Inflows and outflows

• Costs & revenue

• Favorable and unfavorable variances

The difference between the predicted and actual budgeted figures is known as:

• Variance

• Adverse variance

• Profit

• Favorable variance