ECONOMICS

Detailed explanation-1: -A detailed and realistic budget is one of the most important tools for guiding your business. A budget provides essential information for operating within your means, managing unexpected challenges, and turning a profit. A proper budget will identify available capital, estimate expenditures, and anticipate revenues.

Detailed explanation-2: -A budget helps create financial stability. By tracking expenses and following a plan, a budget makes it easier to pay bills on time, build an emergency fund, and save for major expenses such as a car or home. Overall, a budget puts a person on stronger financial footing for both the day-to-day and the long term.

Detailed explanation-3: -The purpose of budgeting is to provide a financial framework for the decision making process i.e. is the proposed course action something we have planned for or not. In managing a business responsibly, expenditure must be tightly controlled.