What is the benefit of preparing a budget?
Answer and explanation
Correct answer: It creates a plan for income and expenses
A budget estimates expected income and expenses for a particular period. It helps an entrepreneur allocate money, set priorities, avoid unnecessary spending, and compare actual results with the plan. Therefore option A is correct. A budget is meant to improve financial control, not automatically increase expenses or remove customers.
Frequently asked questions
What is the correct answer to this question?
It creates a plan for income and expenses
Why is this the correct answer?
A budget estimates expected income and expenses for a particular period. It helps an entrepreneur allocate money, set priorities, avoid unnecessary spending, and compare actual results with the plan. Therefore option A is correct. A budget is meant to improve financial control, not automatically increase expenses or remove customers.
Which subject and chapter does this question cover?
This is a Class 11 Business Studies question. Chapter: MSME and Business Entrepreneurship. Topic: Entrepreneurship Development.
