FINC 1200: Ethical Scenario: Business Budget (Week 11)

What is an operating budget in business?

• A plan for managing social media accounts

• A financial plan that outlines expected revenues and expenses over a specific period of time.

• A forecast of weather patterns

• A budget for personal expenses

What are the advantages of budgeting in business?

• Budgeting leads to financial instability and poor decision-making

• Budgeting does not help in setting financial goals or allocating resources effectively

• Budgeting is time-consuming and not worth the effort

• Budgeting helps in setting financial goals, allocating resources effectively, monitoring performance, and making informed decisions.

How does budgeting help in controlling expenses in a business?

• By randomly allocating funds without a plan

• By ignoring financial constraints

• By increasing spending to boost revenue

• By setting limits on spending and identifying areas where costs can be reduced.

What are the potential challenges in implementing a business budget?

• Lack of coffee in the office

• Alien invasion

• Too much sunshine

• Inaccurate forecasting, unexpected expenses, resistance from employees, and changes in the market

In your own words, why is it ethically responsible to prepare a business budget?