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3.4 Budgeting - notes (HL only)


In the previous section we looked at sources of finance and their suitability, used different methods of investment appraisal, defined working capital and prepared cash flow forecasts. We now move on to look at budgets and variances.

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By the end of this section you should be able to:

  • Explain the importance of budgeting for organisations
  • Calculate and interpret variances
  • Analyse the role of budgets and variances in strategic planning