A compensation budget is a forecast of what the firm expects to spend on compensation in the coming year.

Question

Quizplus · Accepted Answer

A compensation budget is indeed a forecast of the amount a firm intends to spend on compensating its employees in the future. This budget can include salaries, bonuses, benefits, and other forms of compensation. By creating a compensation budget, companies can plan their expenses, manage costs, and ensure they remain competitive in attracting and retaining talent.

A Compensation Budget Is a Forecast of What the Firm