Introduction

This report let the organization compare the definite expenditure with mainly what was planned for. We mainly plan the budget for a particular given time, and then at the last of that particular period, the budget report mainly shows how much amount we have incurred (Liebowitz & Beckman, 2020).

Body

Outline:

The budget has been mainly allocated in café accurately to each department and there are variations of 10%. The actual income is $1760.

Lessons that are learned from the previous quarter are that the food budget should be made as per the funds and resources available only and the café should focus on the decrease of food waste so that there should be a cost reduction (Liebowitz & Beckman, 2020).

Different approaches to the management of budget are given below:

1. Incremental budgeting – The advantages of this approach are given below:

– It is easy and quick to maintain.

– It suits only stable companies with satisfactory historic numbers (Anrig, 2015).

The disadvantages are given below:

– It embeds previous inefficiencies and issues.

– Economically unproductive activities could continue (Anrig, 2015).

2. Zero-based budgeting – The advantages are given below:

– Obsolete and inefficient operations could be superseded.

– It particularly responds to all changes in the environment of business (Month, 2017).

The disadvantages are given below:

– Staff may be demoralized by the requirement for significant effort and time.

– Skills of management may be deficient (Month, 2017).

Recommendations

The recommendations that we can consider by following the given points:

1. Set actual expectations of the budget – Justify all expenditure in connection to its long-duration versatility and profitability (Snell & Morris, 2018).
2. Separate variable and fixed expenses – Every business has particular expenses that mainly remain constant and reliable throughout the whole year and some that might vary.
3. Always check for any competencies in the budget – At the last of each period, the revenue must be capable of covering entire costs (Snell & Morris, 2018).