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What is the main advantage of preparing a budget?

Answer and explanation

Correct answer: Planning income and expenses in advance

A budget is a financial plan prepared for a future period. It estimates expected income and expenses, helping the business decide how money should be allocated and where unnecessary spending can be controlled. It also supports comparison between planned and actual results. Hence, option A is correct; the other options are unrelated or opposite to the purpose of budgeting.

Related tags

BudgetPlanningFinancial-ManagementConceptNature And Importance Of Business FinanceConcept Nature And Importance Of Business FinanceSources Of Business FinanceBusiness StudiesClass 11 Mcq

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