Budgeting

Budgets are a tool that can help hospitality managers reach the financial goals in their business.

• True

• False

A zero-based budget has managers begin a budget from scratch, without using previous data or historical figures.

• True

• False

A zero-based budget is easy to prepare

• True

• False

If a hospitality manager underestimates revenues, this is known as.....

• Top-down budgeting

• Incremental budgeting

• Budgetary slack

• Cash budgeting

A capital budget is used to:

• Summarizes the plan for cash

• Summarizes the plan for acquiring and selling capital assets

• Summarizes the plan for invoicing

• Summarizes the plan for managing accounts receivables

Budgets can be compared to actual amounts and can be used to evaluate the current performance of of the operation and employees.

• True

• False

Incremental budgets do not use historical data

• True

• False

Top-down budgeting is when management determines the budgeted figures

• True

• False

As a future hospitality manager and leader, when preparing a budget, you should always overestimate expenses.

• True

• False