Difference between budgeting and forecasting

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Budgeting involves setting financial goals and limits for a specific period, while forecasting predicts future financial outcomes based on current data and trends.

Budgeting is a plan for how to allocate resources over a specific period, typically a year.
Forecasting involves predicting future financial outcomes based on historical data and trends.
Budgeting is more focused on setting financial goals and limits, while forecasting is about predicting future financial performance.
Budgeting helps in controlling expenses and managing cash flow, while forecasting helps in making informed decisions and planning for the future.
Example: Budgeting would involve setting a limit on marketing expenses for the year, while forecasting would predict the company's revenue for the next quarter based on current sales trends.

Difference between budgeting and forecasting

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