A budget is an estimate of the costs, revenues and resources over a specific time gap which reflects a business future financial achievements. An acolated budget is very important as it also provides a plan for achieving objectives, it allows the business to track its performance and can be used to cope with foreseeable adverse situations.
Uxbridge College use budgets to be able to show to banks or other companies how well the business is predicted to do, if the College is only expected to spend £40,000, but in the next year but expecting to turnover £100,00 profit, they are very inclined to receive financial support if they can prove the loan will be paid back. A budget also shows what the company will spend over the next academic year for the College with a breakdown of how the funding will be spent on certain resources, for example the College budget will include how much they can spend on employee wages and how much food resources should be purchased. This will make sure that the College do not overspend overall and in specific sectors, it is vital that the College abides to the budget they have set in order to be successful. A budget will limit the sum Uxbridge College will spend on a certain project, budgets insure money is not wasted on resources which are not viewed useful.
Uxbridge College need to make sure they are able to establish their main priorities from their allocated budget, the college should view which sectors are entitled to funding money for example the Research Department, the Marketing Department, and how much should be spent on different sectors of the college. College Staff should have knowledge about the colleges budget and kept up to date throughout the academic year on how well they are doing working with the budget, if it looks like a specific department goes above their allocated budget it may motivate staff to keep spending costs to a minimum, jobs and responsibilities may also be delegated within the store so all staff are useful and are having a positive impact, if they aren’t worth the money they’re paid to be there they should be delegated tasks to do. People within McDonalds will have responsibilities concerning different aspects of their budget to ensure the spending is done efficiently and money is not spent unnecessarily, for example they are not overstaffed or stores do not have more food than needed which would result in being wasted and therefore a waste of