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- Types of budget with examples are12:
- Master budget: a collection of operating and financial budgets for a fiscal term. Example: a master budget for a company that includes sales, production, and income budgets.
- Cash budget: a budget for projected cash inflows and outflows over a specified period. Example: a cash budget for a small business that shows the expected cash receipts and payments for a month.
- Static budget: a budget that is based on a fixed level of activity. Example: a static budget for a factory that assumes a constant output and does not change with actual production.
- Flexible budget: a budget that adjusts to the actual level of activity. Example: a flexible budget for a restaurant that varies the food and labor costs according to the number of customers served.
- Operating budget: a budget that covers the day-to-day operations of a business. Example: an operating budget for a retail store that includes sales, merchandise purchases, and expenses.
- Financial budget: a budget that shows the expected financial position and performance of a business. Example: a financial budget for a corporation that includes a cash budget, a pro forma income statement, and a pro forma balance sheet.
- Capital expenditure budget: a budget that plans for the acquisition and disposal of long-term assets. Example: a capital expenditure budget for a hospital that lists the equipment and facilities to be purchased or replaced.
- Program budget: a budget that allocates resources to specific programs or projects. Example: a program budget for a government agency that shows the funding and expenses for each program or service.
- Incremental budget: a budget that is based on the previous year's budget with adjustments for inflation, growth, or other factors. Example: an incremental budget for a school that increases the previous year's budget by a certain percentage.
Learn more:✕This summary was generated using AI based on multiple online sources. To view the original source information, use the "Learn more" links.Some of the types are:
- 1. Master Budget A master budget is a collection of operating and financial budgets for a fiscal term. ...
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Learn about the four main types of budgets and budgeting methods: incremental, activity-based, value proposition, and zero-based. Compare their advantages and disadvantages, and see examples of each method. See more
Incremental budgeting takes last year’s actual figures and adds or subtracts a percentage to obtain the current year’s budget. It is the most … See more
Activity-based budgeting is a top-downtype of budget that determines the amount of inputs required to support the targets or outputs set by the company. For example, a company sets an output target of $100 million in revenues. The company will need to first … See more
As one of the most commonly used budgeting methods, zero-based budgetingstarts with the assumption that all department budgets are zero and must be rebuilt from scratch. Managers must be able to justify every single expense. No expenditures are … See more
In value proposition budgeting, the budgeter considers the following questions: 1. Why is this amount included in the budget? 2. Does the item create value for customers, staff, or other stakeholders? 3. Does the value of the item outweigh its … See more
Explore further
- Master budget. A master budget is the overall financial and operating plan for …
- Operating Budget. The operating budget is created to reflect the results of …
- Financial Budget. The financial budget is created to reflect the financial …
- Static (fixed) Budget. A static budget or also known as the Fixed Budget …
- Flexible (expense) Budget. A flexible budget or also known as the Expense …
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