What Is a Project Budget?
A project startup budget is a medium used to predict a project's complete expense. This involves a comprehensive estimate of all expenses probable to be incurred before completion of the project. The project budget initially enables the project manager to determine the price of the project. Moreover, it allows the project director to verify whether the project is adhering or not to its budget throughout the course of the project.
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How To Create a Project Budget In Microsoft Word
Almost all of the project managers will have accountants to help them put together project budgets. But what if you don't? Basically, you'll need to learn how to create a budget sheet. If you don't have any idea how to do so, then this article is for you. Here are easy steps to follow.
1. Use a List of Tasks
First things first, take your project task. You may have a work breakdown structure as well, and if you already have one, it is best to utilize it. But a list of tasks will do as long as it includes all you need to do the project.
2. Estimate All Components
Now go through the list and work out each item's cost. For instance, a job that says "setting up a meeting to discuss demands" could require purchasing and hiring, meeting rooms or purchasing any resources you need, such as a projector or flip chart pens. There is a cost associated with that, so prepare quotes for your room hire and the other tools and note it down. According to www.scbi.com, the estimate aids developers in determining the feasibility and profitability of a potential project. Thus, the procurement of financing will also depend on the estimate report.
3. Calculate Estimates Together
Now, you are going to add the estimates altogether. You should try to use a spreadsheet for you to do it quickly. After, add the costs in the next column and then calculate the column at the bottom. Let the spreadsheet be your budget outline.
4. Add Contingency and Taxes
A contingency fund is a fund based on how confident you feel that the estimates are correct. It is not related to any specific assignment. It is a general "emergency pot" in case you got something incorrect or left something out by error. Make sure to add in any sales tax or other tax invoices that are not explicitly already included in your individual line item estimates. To get your final budget amount, add all the contingency and taxes.
5. Get Approval
The next thing you have to do is get your project manager or sponsor to confirm your budget report. Speak to them about how you put it all together and what your general budget consists of.
6. Recheck your Document
Before finalizing your project budget document, it is essential to always go over what you have written in order not to submit a document full of errors.