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[Music] lets take a look at operating budgets many managers fear developing budgets because they have weak math or accounting skills in reality budgeting requires planning skills rather than math or accounting you usually have prior years budgets as a guide to use which needs updating for the coming year the operating budget includes the revenue and expense budget you must first determine how much money you have or will have before you can plan how youre going to spend it a revenue budget is a forecast of total income for the year the revenue budget adds together projected incomes from all sources like sales or product and location an expense budget is a forecast of total operating spending for the year its common for each functional area or department manager to have an expenditure budget and they need to track monthly spending and find ways to cut them profits come from increasing revenues or reducing expenses one thing to realize is yes you should control and try to decrease expe
