1. BUDGETING TECHNIQUES & Terms Exploring Business & Marketing

2. Write a paragraph using the following Ch. 28 Key Words Money Management BudgetIncome Gross pay Deductions Net pay WithholdingExpenditures Fixed expenses Variable expenses Budget variance

3. Budget A spending and saving plan

4. Main Purposes of a Budget Live within Income Achieve financial goals Buy Wisely Avoid credit problems Plan for financial emergencies Develop good money management

5. The process of creating a budget involves: Setting financial goals Planning budget categories Maintaining financial records Evaluating your budget

6. Fixed Expenses Costs that occur regularly at the same amount each time –Rent –Mortgages –Payments –Insurance premiums

7. Variable expenses Living costs with differing amounts each time –Food –Clothing –Utilities –Medical/Dental

8. Allowance Amount budgeted for savings and other expenditures

9. Budget Categories SavingsFoodClothingHouseholdTransportation Health & Personal Care Recreation & education Gifts & Contributions

10. Budget Variance Comparison of actual spending with budgeted amount

11. Characteristics of a successful budget: Must be realistic Should be flexible Evaluated regularly Well planned & Communicated effectively with concerned parties Simple format

12. How are financial goals important to budgeting? First step of any financial strategy Helps decide where you would like to be financially Develop budget accordingly

13. Why are variable expenses more difficult to budget than fixed expenses? They vary from month to month

14. Factors that influencing budget categories Rent of facilities Business size # of employees Cost of living in your area Utilities costs Economy fluctuation Insurance benefits Payroll Product producing costs

15. Budget Variance—Should you change your spending plan? Not necessarily If you expect continued higher or lower expenditures, consider it!

16. Put it in Writing You may forget how much is to be spent or has been spent

17. Deficit When actual spending is greater than planned spending

18. The End!