Outline the purpose of budgets within organizations

A budget is of utmost importance to any organization. No
organization will take a single step forward without a proper
budget.

For example an Army prepares action plan before
starting with a war, An architect prepares architectural design before starting the
construction of a building, in the same way a business man needs a road map with regard
to financial outlay needed for a project and that is nothing but a
budget.

A budget is action plan or a blue print prepared in
advance of action. Every department of organization needs a budget, that's why there
various functional budget within  an organization like-

(1)
Purchase budget.

(2) Sales
budget.

(3) Material consumption
budget.

(4) Production
budget.

(5) Cash budget and
finally

(6) the master budget which includes all the
functional budget.