Q:

How are budget sheets used?

A:

Quick Answer

Budget sheets are used to track income, expenses and progress on financial goals. Budget worksheets can be created on a weekly, monthly, quarterly or yearly basis.

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Full Answer

Budget worksheets display projected financial information to help businesses and individuals make investment decisions. The worksheets are analyzed to determine ways to improve cash flow and minimize expenditures. Budget worksheets can be created by hand or through software such as Microsoft Excel. Companies can also prepare budgets through their own accounting software.

Individuals and businesses also use budget worksheets to conduct variance analysis. This type of analysis compares budgeted amount to actual results. Any differences between these figures can lead to adjusting goals, modifying objectives or developing new strategies. A budget worksheet displays differences between projected and actual data with considerations of materiality. For instance, a deviation from the budgeted amount that is less than 2 percent may be considered immaterial or not worth investigating. Deviations from a budgeted amount may also be due to economic conditions, such as seasonality. For instance, retail outlets may expect higher sales during the holiday season.

An effective budget worksheet lists all variances, materiality figures and reasoning. As of 2015, both Google and OpenOffice offer free budget templates.

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