Budgeting – customising budgets to review verses actuals
Fixed Costs, Variable Income & Expenses – Sounds Like a Budget is a good Plan!
Most bookkeeping software today provides a budgeting facility to compare with Actual Profit & Loss. Depending on the business, it may be possible to create a detailed budget to really set your business some targets and measure each month how things are travelling. For some though, a budget can be as simple as working up from fixed costs, including variable costs to arrive at a minimum sales turnover per month that needs to be achieved for the business to break-even, make a small profit or really flourish! The size of the profit can depend on the industry that your business is in, but also the lifestyle that you would like to achieve.