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ACKNOWLEDGEMENT

I would like to thank my Math's Sir , Vilas Wagh , for giving me such an interesting
project .i have learnta lot about planning a house in this project . I alsothank
my parents for their constant help andsupport for me during this project.

CONTENTS

What is Budget?

Types of Budget

What is Personal Budget?

Tools used for creating a personal budget

Following a Budget

Home Budget for Chopra Family

Example

For the Month of January

Bar graph

Pie chart

Pie chart

Conclusion

Bibliography

WHAT IS BUDGET?

A budget is a list of all planned expenses andrevenues. It is a plan for saving and
spending. Abudget is an important concept in microeconomics,which uses a budget
line to illustrate the trade-offsbetween two or more goods. In other terms, a budget
isan organizational plan stated in monetary terms. In summary, the purpose of
budgeting is to:
1.
Provide a forecast of revenues and expenditures,that is, construct a model of how
our business mightperform financially if certain strategies, events andplans are
carried out.
2.
Enable the actual financial operation of thebusiness to be measured against the
forecast.

T
YPES
OF
B
UDGET

Budget types
1.
Sales budget:
The sales budget is an estimate of future sales,often broken down into both units
and dollars. It is used tocreate company sales goals.
2.
Production budget:
Product oriented companies createa production budget which estimates the
number of units thatmust be manufactured to meet the sales goals. The
productionbudget also estimates the various costs involved withmanufacturing
those units, including labor and material.
3.
Cash Flow/Cash budget:
The cash flow budget is aprediction of future cash receipts and expenditures for
aparticular time period. It usually covers a period in the shortterm future. The

cash flow budget helps the business determinewhen income will be sufficient
to cover expenses and when thecompany will need to seek outside financing.
4.
Marketing budget:
The marketing budget is an estimate of thefunds needed for promotion, advertising,
and public relations inorder to market the product or service.

4
. Marketing budget:
The marketing budget is an estimate of the fundsneeded for promotion, advertising,
and public relations in order tomarket the product or service.
5. Project budget:
The project budget is a prediction of the costsassociated with a particular
company project. These costs includelabor, materials, and other related expenses.
The project budget isoften broken down into specific tasks, with task budgets
assigned toeach.
6. Revenue budget:
The Revenue Budget consists of revenue receipts of government and
the expenditure met from these revenues. Taxrevenues are made up of taxes and
other duties that the governmentlevies.
7. Expenditure budget:
A budget type which include of spending dataitems.

TOOLS USED FOR CREATING A PERSONAL BUDGET

Several tools are helpful for constructing a personal budget. Regardless of the tool
used,a budget's accuracy is only as good as the accuracy of the updated budget
data; an oldbudget that does not reflect actual income or expenses is of little use to
a current budget.Computer generated budgets have become commonly used as
they replace the need torewrite and recalculate the budget every time there is a
change.

Pencil and paper

A simple budget can be written on a piece of a paper with a pencil, and optionally,
a calculator.Such budgets can be organized in three-ring binders or a file cabinet.
Simpler still are thepre-formatted household budgeting or bookkeeping forms that
creates a budget by filling in the blanks.

Spreadsheet software
Spreadsheet software, including Microsoft Excel, iWork Numbers or
OpenOffice.org Calc, helps to arrange budgets according to need and performs
calculations easily withrudimentary formulas. For example, budget spreadsheets
are used to keep track of incomeand expenses. The major reason most people
discontinue using budget spreadsheets thatdon't offer date-shifting is that the
information needs to be reentered or moved at the endof each month. Spreadsheets
are still excellent for complex budgets and planning.

Money-management software
Some software is written specifically for money management. Products suchas
Fortora Fresh Finance, Money dance, Quicken, MicrosoftMoney (discontinued),
and Gnu Cash are designed to keep track of individual account information, such
as checking, savings or money-marketaccounts. These programs can categorize
past expenses and displaymonthly reports that are useful for budgeting future
months.

Money-management websites
Several websites, such as Mint.com and Thrive, have been devised to helpmanage
personal finances. Some may have a privacy policy governing theuse and sharing
of supplied financial information.

Spending-management software
Spending-management software is a variation of money-managementsoftware.
Unlike typical budgeting that allocates future personal incometowards expenses,
savings and debt repayment, this type of softwareutilizes a known amount of
money, the cash on hand, to give the user information regarding what's left to
spend in the current month. Thismethod eliminates some of the guess work
associated with forecasting what a person might receive for income when it comes
to allocating budgeted money. Like money-management software, some spendingmanagement software packages can connect to online bank accounts inorder to
retrieve a current status report.

FOLLOWING A BUDGET

Once a budget is constructed and the proper amounts are allocated to their proper
categories, the focus for personal budgeting turns to following the budget.As with
allocation, there are various methods available for following a budget.

EnvelopesEnvelope Accounting
or the is a method of budgeting where on a regular basis (i.e.monthly, biweekly,
etc.) a certain amount of money is set aside for a specificpurpose, or category, in
an envelope marked for that purpose. Then anytime youmake a purchase you look
in the envelope for the type of purchase being considered to see if there are
sufficient funds to make the purchase. If the moneyis there, all is well. Otherwise,
you have three options: 1) you do not make thepurchase; 2) you wait until you can
allocate more money to that envelope; 3) yousacrifice another category by moving
money from its associated envelope. The flipside is true as well, if you do not spend
everything in the envelope this month thenthe next allocation adds to what is
already there resulting in more money for thenext month.
With envelope budgeting
, the amount of money left to spend in a given category canbe calculated at any
time by counting the money in the envelope. Optionally, eachenvelope can be
marked with the amount due each month (if a bill is known aheadof time) and the
due date for the bill.

Spreadsheet budgeting with date-shifting


Budget spreadsheets with date-shifting, like Budget-Master.com,typically offer a
detailed view of a 12 month, income and expense,plan. A good way to follow and
manage a budget when using aspreadsheet that offers date-shifting is to set the
current month afew months before the current month along the 12-month cycle.

Quinn-CO

The Quinn-CO method of budgeting is based on a Canadianbusiness model where


categories of expenses are set up as costcentres. Cost centres are broken out into
three categories of spending: fixed expenses, variable expenses and savings.
Costcentre targets are based on percentages of monthly net revenue(household
gross income minus taxation and employeedeductions). All expenses are allocated
to appropriate costcentres based on a set of business rules outlined in the
bookWake Up or Die Poor The ratio of fixed expenses to variableexpenses to
savings make up a family's pie. When fixed expensesmake up more than 50% of a
household's net revenue, That-COis in the "prickly" pie.
NOTE: ONE FULL PAGE HOME BUDGET FOR CHOPRA FAMILY
EXAMPLE
1.
Familys Name : Chopras
2.
No. of Family members:6
3.
No. of Earning Members of the Family: 2
4.
No. of children studing:2
5.
No. of Helping Hands at home:2(1 part-time,1 full time)
6.
No. of Telephone lines (Land lines):1
7.
No. of Mobile phones:4
8.
No. of Vehicals:2
9.
(1 four wheeler;1 two wheeler)
10.
House owned
11.
Designation of earning members : Grandfather: Manager in ICICI Bank
Father : Executive director in Mehta & Mehta
Company

FOR THE MONTH OF J ANUARY


CATEGORY MONTHLY AMOUNT
TOTAL INCOME
75000
TAXES
15000
ACTUAL INCOME
60000
HOUSE MAINTAINANCE
4000
GROCERRY+FRUITS+VEGETABLES
MILK
5000
ELECTRICITY+WATER
2500
CONVEYANCE
1000

CATEGORY MONTHLY AMOUNT


CLOTHING
2500
EDUCATION+CLASSES
5000
ENTERTAINMENT+PRESETATION
AUTOMOBILES
2000
TELEPHONE+MOBILE
2000
HOME HELPERS
1500
REPAIRS
500
CABLE+INTRNET CONNECTION
TRAVELLING
2000
LAUNDARY
500
SHOPPING
2500
STATIONERY
500
MEDICAL
5000
GRAND TOTAL
51000
SAVINGS
9000
YEARLY SAVINGS
10800

12000

2000

500

BAR GRAPH COMPARING ALL THE EXPENSES