This document provides an overview of budgets, including their meaning, purpose, types, advantages, and limitations. It defines a budget as a financial plan that lists all revenues and expenses. Budgets are prepared annually by the Indian government. They serve several purposes, such as controlling resources, communicating plans, motivating managers, and evaluating performance. Budgets can be classified by time period (long, short, current) or function (master, operating, financial). The document also outlines the various types of operating and financial budgets. Advantages of budgets include aiding decision making and promoting specialization. Limitations are that budgets only provide estimates and can be inflexible.

1. BUDGET
Submitted By:
Pooja sharma,
Varsha Singh
MBA(sem-I)

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CONTENT :
• Meaning and defination
• Purpose
• Needs
• Classification and Types
• Advantage
• Limitations

3. Meaning and definition
Budget is a financial plan and a list of all
revenues. It is a plan for saving
borrowing and spending money.
In India
The budget is prepared by the
Budget Division of Department of
Economic Affairs of the Ministry of
Finance annually.
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4. Purpose of Budget
• To control resources.
• To communicate plans to various
responsibility center managers.
• To motivate managers to strive to
achieve budget goals.
• To evaluate the performance of
managers.
• To provide visibility into the company's
performance.
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5. Need of Budget
• It helps you keep your eye on the prize.
• It leads to a happy retirement.
• It helps you prepare for emergencies.
• It's better than counting sheep.
• It sheds light on bad spending habits.
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6. Classification and Types
of Budget
 Classification according to time.
1. Long-term budget
2. Short-term budget
3. Current budget
 Classification on the basis of
function.
1. Master budget
2. Operating budget
3. Financial budget
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Type of Operating Budget
Sales budget
Production
budget
Production
cost budget
Purchase
budget
Raw material
budget
Labour
budget
Operating
budget

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Type of Financial Budget
Financial
Budget
Cash Budget
Working
capital
Budget
Capital
expenditure
Budget
Income
statement
Budget

9. Advantage of Budget
• The control information's supplied for
budget helps decision making of the
managers concerned.
• Budget forces the organization to
quantity, i.e. state in figures what is
required to be achieved.
• Budget promotes division of work and
specialization. Specialization brings
efficiency not only in the working of
employees but in the organization as a
whole.
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10. Limitations of budget
• Budget provides only approximate
estimates. Hence results cannot be
measured accurately.
• Quick results cannot be achieved as it is
prepared for a year
• One of the important limitations of budget
is its inflexibility.
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11. THANK YOU
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