Page 36 - Managerial Accounting-MGT 145

Module 6: Budgeting

Module 6. REQUIREMENT

Answer the following questions:

1. What is budgeting?

2. What are direct costs?
3. What are indirect costs?

4. From an owner’s perspective, what is the goal of the
budget process?
5. What are the two major components that forms the

basis of project controls?

Solution to Module 6. REQUIREMENT

1. Budgeting is a process used to allocate the

estimated costs of resources into cost accounts
against which cost performance will be measured

and assessed. Budgeting considers time-phase in
relation to a schedule and/or time based financial
requirements and constraints.