How can a budget help in decision making?

Question

Quizplus · Accepted Answer

A budget can help in decision making by identifying excesses or shortages of cash, predicting purchase requirements for raw materials, and identifying future resource constraints. By considering these factors, decision makers can make informed choices about how to allocate resources and prioritize spending to achieve their goals. A budget can also help to identify areas of waste or inefficiency, enabling organizations to make adjustments and streamline their operations for greater efficiency and effectiveness. Overall, a budget is an essential tool for effective decision making at all levels of an organization.

How Can a Budget Help in Decision Making