A master budget includes the subcategories of operating budgets and financial budgets The sales budget is the first budget developed, and the estimated sales in turn guide the production budget

There are various budgeting strategies including bottom-up, top-down, and zero-based budgeting A static budget is prepared at one level of activity, while a flexible budget allows the variable expenses to be adjusted for various levels of activity

budget — quantitative plan estimating when and how much cash or other resources will be received and how the cash or other resources will be used. financial budget — category of budgeting that details estimates for cash inflows and outflows through planned operations and changes capital investments of assets, liabilities, and equities. operating budget — category of budgeting that helps managers plan and manage production, order materials, schedule direct labor, and monitor overhead expenses. production budget — budget showing the number of units that need to be produced for each period based on sales estimates and required inventory levels.