What is defined as a detailed plan of how money will be spent or received?

A budget is defined as a detailed plan of how money will be spent or received. It involves forecasting income and expenses over a specific period, allowing individuals or organizations to allocate resources effectively. By outlining expected revenues and planned expenditures, a budget helps to track financial performance and ensure that spending aligns with overall financial goals.

The primary purpose of a budget is to provide a framework for managing finances, enabling individuals to anticipate their financial needs and avoid overspending. It serves as a financial road map that guides decision-making and aids in achieving long-term financial stability and success. Budgets can be adjusted as circumstances change, making them essential for both personal finance and business operations.

The other choices, while related to financial management, do not capture the comprehensive planning aspect that specifically distinguishes a budget. Financial statements summarize financial status at a point in time, expense reports track expenditures after they occur, and cash flow plans focus on the movement of cash in and out without the structured planning aspect that a budget provides.