subapr2002

 Profile Answers by subapr2002 

• Jun 7th, 2009

 

Budget:

A predefined amount in the picture to control the companies expenses like what we do budgetting at home.We allocate some defined amount to spend ,so we target to not to exceed this.This is called Budgetting.

Encumbrance:

Eventhough we define a budget some unpredicted expenses will come and affect the budgetting.This is called Encumbrance

satishmkumar

 Profile Answers by satishmkumar 

• Jun 25th, 2009

 

Budgets are used for better planning and control expenditures.  A Budget is a collection of (1) PERIODS (2) ACCOUNTS (3) AMOUNTS

Balance Types are of 3(Three) types...
1. Actuals
2. Budgets
3. Encumbrance

(1) Actuals: Actuals are the journals which are reported from Payables, Receivables, Cash Management etc., These are the balances which are used to prepare our financial statements.

(2) Budgets: Budget balances are the funds are allocated to the various accounts.

(3) Encumbrance: Encumbrance balances are the funds reserved for the budgets for future expenses.

peterson1975

 Profile Answers by peterson1975 Questions by peterson1975

• Nov 16th, 2009

 

A budget is a forecast (estimate) of cost, expenditure or /and revenue for a specified period of time. it may include one or mare accounting
years. It is used to major the achievement of the company's goal or objectives.

An encumbrance is part of the budgeted amount that prevents the user from exhausting their budget
amounts. when a user's expense is extending into the encumbrance amount an alert will be generated so that management can adjust the budgeted amount.

James123

 Profile Answers by James123 Questions by James123

• Feb 8th, 2010

 

Simply a budget is a kind of Reserve kept for future purpose expenses for KNOWN expense overheads.

Ex: Stationary, Machinery, Computers, Bonuses..etc. etc..    Whereas

Encumbrance is a kind of Reserve kept for future purpose expenses for UNKNOWN expenses or Unexpected Expenses.

Ex: Employee Accident and his Operation Expenses. 
      Fire in Factory or office and Damage Equipments and get repaired.