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March 24, 2026

Explain the goals of budgeting and describe the steps required to build a budget.

1) Explain the goals of budgeting and describe the steps required to build a budget.
2) Explain the role of variance analysis. Also, explain the four ways managers can compare the financial performance of their areas of responsibility.
3) Explain: a) the reasons for using estimates; and, b) the purpose of benchmarking.
4) Explain why the value of monies received in the future is lower than the value of the same money today.
5) Explain why a capital budget is necessary and describe the major steps in creating a capital budget.

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