Business and Personal Finance Dictionary

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• FINANCIAL BUDGET
  
  is focused on capital expenditures and on a business’s budgeted cash position: 1. CAPITAL BUDGET forecasts large expenditures for items such as machinery. Different companies set different thresholds for what qualifies as a capital expenditure (versus an expense). If the purchase of an item (such as a piece of machinery) is classified as a capital expenditure, it is then depreciated (or amortized in some cases) over a predetermined period of time. The Capital Budget covers Capital Expenditures, Disbursements for Capital Expenditures, and Depreciation Budgets. 2. CASH BUDGET tracks a business’s anticipated cash receipts and disbursements. This is a very detailed and important schedule that draws on information in the Operating Budget.
  
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