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Essay / Research Paper Abstract
This 3 page paper consider why and how budgets are important to businesses, defining what is meant by a budget, the way it can be created and used and the benefits that the information in a budget will give to managers of a business. The bibliography cites 3 sources.
Page Count:
3 pages (~225 words per page)
File: TS14_TEbugt01.rtf
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Unformatted sample text from the term paper:
budgeting. To understand this we first need to look at why a company is in business and seeking to introduce new ranges and expand is likely to have the aim
of increasing profits or at least increasing the customer base without increasing costs so that profits can be increased at a later date.
The importance of budgets and budgetary control cannot be understated. There are many different interpretations of these terms, but to find an all encompassing term it may be best
to use a definition from a management accounting organisation. The Institute of Cost Management Accountants describe a budget thus; "A financial and or/quantitative statement prepared prior to a defined
period of time, of the policy to be pursued during that period for the purpose of attaining a given objective. It may include income, expenditure and the employment of capital"
(Chadwick, 1998). This means the role of the budget is forecast and/or to control the costs and therefore the profits. It is
also important in the short term for cash flow as there needs to be the ability for a company to be able to pay their suppliers and creditors in the
short term (Chadwick, 1998). Therefore, budgets can be seen as an important mechanism for controlling a company. Therefore, we can see it is a predetermined plan that is used to
determine the way a business uses its resources. This will also need to be controlled. If we look at the development of the company four different products are all planed,
to make sure these will achieve the goals of the company, which we will assume is increased profit, then the company need to look at all the costs of the
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