ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -In general, it’s much easier to predict your expenses than your revenues. Start building your forecast model by outlining your fixed expenses, things like rent, utilities and insurance. You can be almost certain these costs will occur in the coming quarter/year.

Detailed explanation-2: -One of the biggest challenges with any forecast is estimating changes to potential future business (wins, losses or leads). As a result, most top down revenue estimates do not account for new sales opportunities.

Detailed explanation-3: -Forecasting involves making predictions about the future. In finance, forecasting is used by companies to estimate earnings or other data for subsequent periods.

Detailed explanation-4: -It focuses on two things-the number of products sold and the price at which they are sold-to predict how the company will perform. A sales budget isn’t the same as sales forecasting, which is the process of estimating future sales revenue. But a solid sales budget may be used to inform a sales forecast.