AFM123 Chapter Notes - Chapter 7: Budget, Finished Good, Income Statement
Document Summary
Budgeting the process used by businesses to describe how they intend to achieve their desired inancial/noninancial objectives. Budget a quantitative plan for acquiring and using inancial and other resources. Budgeting is accomplished through the preparation of a number of budgets, which collectively form an integrated business plan known as the master budget. Planning involves developing objectives and preparing various budgets to achieve these objectives. Budgetary control use of budgets to guide and coordinate activities across the irm to ensure that objectives are attained. Control involves the steps taken by management that attempt to ensure the objectives are attained and all parts of the organization function in a manner consistent with organizational policies. Budgets are the result of planning and the basis for control. Think about and plan for the future. Master budget is the principal output of the budgeting process.