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Horngren'S Financial And Managerial Accounting
Found in: Page 1228

Short Answer

Budgeting benefits List the three key benefits companies get from preparing a budget.

The key benefits companies get from preparing a budget is planning, coordination and communication, and benchmarking.

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Step by Step Solution

Step 1: Budgeting benefits

Budgeting helps managers to plan, improve coordination and communication, and set benchmarks for evaluating actual performance.

Step 2: Three key benefits companies get from preparing a budget

  1. Planning: - Managers plan for the company’s future using budgeting. The better they plan the higher are the chances to achieve targets.
  2. Coordination and communication: - The managers of different levels and functions work together to make a comprehensive plan for the business.
  3. Benchmarking: - Managers together set benchmarks for the employees and compare them with actual output

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