Week_2_-_DQ_2 - An operating budget has to do with...

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Week 2, DQ 2 Define the difference between forecasting and budgeting. What is the difference between an operating budget and a cash budget? To forecast, in Accounting terms, is to make a statement about an expected outcome…say  Cash Forecasting. A budget is a financial forecast planned by management of an organization. A budget is made  by management in order to control the business. A forecast is a statement of an expectation that is likely to occur. A budget actually sets  minimum requirements. For example: a spending budget might be set, based on a sales forecast.
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Unformatted text preview: An operating budget has to do with operating costs, primarily costs associated with producing services or merchandise of an organization. A cash budget is for a certain time period of cash inflows and outflows. The goal of the cash budget is for cash planning and control. A cash budget is used by management as an aid to meeting the organization’s cash needs. A cash budget is normally divided into four sections: Receipts, Disbursement, Cash Surplus/Deficit, and Financing sections....
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This note was uploaded on 08/21/2010 for the course FIN FIN370 taught by Professor Mr.garcia during the Fall '09 term at DeVry Long Beach.

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