Question

Differentiate between budget and forecast.

Answer 1

Difference between budget and forecast.

Basis for comparison	Budget	Forecast
Meaning	A budget is a financial plan expressed in quantitative terms, prepared by the management in advance for a pre defined period.	It is the estimation of future trends and outcomes, based on the past and present data.
What it contains?	It is the financial expression of a business plan or target.	It is the prediction of upcoming events or trends in business, on the basis of present business conditions.
Targets	Budget sets targets	Forecast does not set any target
What it estimates?	What business wants to achieve	What business will achieve