Operating Budget - Operating Budget Definition

An operating budget is the annual budget of an activity stated in terms of Budget Classification Code, functional/subfunctional categories and cost accounts. It contains estimates of the total value of resources required for the performance of the operation including reimbursable work or services for others. It also includes estimates of workload in terms of total work units identified by cost accounts.

In the United States, businesses along with state and local governments divide their budgets into two types: the operating budget and capital budget. The operating budget is used to keep track of maintenance operations, salaries, and interest payments.

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