Setting category expenditure
- Start a new budget by clicking New Budget File on the File menu.
- Create a new a new category named Utilities.
- Create a sub-category of Utilities named Electricity.
- Lets assume that while you're familiar with your monthly electric bill, without a making a calculation you're not sure what this represents per year. Let the program do the calculating. Click the per month circle to indicate that the expenditure figure we are about to enter is for an average month.
- Click in the Category Amount box to enter the typical monthly expenditure for Electricity. Type in $80 and press the enter key to confirm.
-
Look at the budget tree. It now contains the correctly calculated annual expenditure
for Electricity, $960.
Note: If you want to print out a quarterly, or a monthly budget, you can indicate this in the Print-Preview section of the program where the final form of the Budget printout is set, but in the budget tree itself all amounts in the budget tree should represent annual expenditure.
- Lets see what happens if we click the per
Year circle:
- The figure in the budget tree has been recalculated based on the incorrect
assumption that $80 is our annual expenditure.
- This is not what we want so click the per month circle again to correct the value in the budget tree.
Doesn't rise with inflation
Note: This option is only relevant if you use the Inflation and Synchronize controls.
- After you have built your budget you may choose to use the Synchronize button
to link Expenditure in
the
Accounts section with your budget
total. You can then observe, in the dual chart display, the effects
of following a particular budget over a number of years. (Expenditure
is subtracted annually from the Primary Account which is represented
by the lower chart).
If a non-zero figure for Inflation has been set, the program, by default, assumes that Expenditure increases with Inflation over time. When Expenditure and Budget Total are synchronized the portion of Expenditure which represents those expenses marked Doesn't rise with inflation will remain constant. An example of such an 'expense' would be fixed loan repayments.