Managers prepare budgets with the objectives of;

• allocating the company’s resources to each operation effectively,
• communicating the objectives and goals to the subordinates,
• motivating the superiors and subordinates towards the goals,
• providing coordination among all divisions or employees,
• comparing the actual and budgeted results, and take corrective actions, if necessary,
• taking necessary precautions for the possible bottlenecks that the company may face in the following period.