A budget is a financial plan for a defined period that estimates income, expenditures, and capital. Budgets can be classified according to time as long term, short term, or current budgets. They can also be classified by function as budgets for sales, production, costs, purchases, personnel, research and development, capital expenditures, cash, and a master budget. Budgetary control allows a company to plan and monitor its finances using budgets prepared prior to the budget period.