Balanced Budget 2020-03-26 08:00:00

Balanced Budget

A balanced budget occurs when revenues are equal to or greater than expenses. When a company spends more than it makes, it incurs a net loss. Too many quarters like that and the company can go out of business. A budget is generally considered balanced only after a year of revenue and expense generation. When revenues exceed expenses, a budget surplus occurs. A budget surplus can provide an excess of cash that can then be invested in future projects or stored away for difficult times.

 


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