FPM_Week 6_Budgeting

What is the main reason for making a budget?

• To plan for money coming in and going out

• To decorate the office

• To hire more people

• To make a new logo

Why do businesses use budgets?

• To make products faster

• To help control spending

• To hire more people

• To paint the office

What does "variance" mean in budgeting?

• The total money spent

• The difference between what was planned and what happened

• The number of products made

• The amount of tax paid

Which of these is part of a sales budget?

• How many items you plan to sell

• The number of employees

• The size of the office

• The colour of the product

What is a production cost budget?

• A plan for how much it will cost to make products

• A list of customers

• A plan for advertising

• A list of holidays

If you spend less than you planned, what is this called?

• Adverse variance

• Favourable variance

• Sales budget

• Production cost

Which of these helps control a budget?

• Ignoring spending

• Checking actual spending against the plan

• Spending more than planned

• Not making a plan

If you sell more than you planned, what is this called?

• Adverse variance

• Favourable variance

• Production cost

• Budget control

Which of these is NOT part of a production cost budget?

• Direct labour

• Factory overheads

• Sales revenue

• Direct materials

What does a sales budget help you do?

• Plan how much you will sell

• Paint the office

• Hire new staff

• Buy new machines