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Zero-based Budget Spreadsheet Template
The zero-based budget template refers to the budget that is prepared mainly in order to justify the expenses for each of the new periods where the budget starts from zero unlike in case of a traditional budget where the adjustments are made in the previous budgets. Zero-based budgets are prepared in such a manner where the difference between the income from all the sources and the expenses from all the sources comes to zero.
About the Template
- It highlights the income of the person from all the sources for the period under consideration along with the expenses of the period for the same period and lastly the difference between the income and expense which should be equal to zero.
- In the case of the zero-based budget, in the end, the budget should be balanced fully and one should have zero budget as leftover. The template which is given above shows the budgeted income and costs expected to be incurred by the company along with the income and costs actual balance for the period.
Components
Following are the different details that are present generally in the template:
#1 – Heading at the Top:
In the template, the heading ‘Zero base budget Template’ will be mentioned. It will remain intact for all the template users. The heading is mentioned in order to tell the user the purpose of the creation of such a template.
#2 – Summary of the Budget:
This summary detail of the budget is shown at beginning of the template which contains details of the Total Income during the period, Total Expenses during the period and the total balance during the period on actual as well as a projected basis. These figures will be populated automatically from the values derived from the below steps.
#3 – Fixed Expenses:
Under this, all the fixed expenses in budgeted and actual values from all the areas will be mentioned.
#4 – Variable Expenses:
Under this, all the variable expenses in budgeted and actual values from all the areas will be mentioned
#5 – Balance:
Balance left will be calculated automatically after subtracting the total of the fixed and the variable expenses from the total income. This balance of projected figures should be equal to zero i.e., the budget should be balanced fully.
How to Use this Zero Based Budget Template?
Following are the steps that have to be followed in order to use the Zero base budget template:
- A person using this template has to enter all the details as required in the fields that are not already pre-filled.
- For this, firstly all the sources of income are to be identified and entered in the point Income /Funds Received during the period. The amount is entered should be net take-home pay and not the gross pay as the budgets are prepared considering what the person is actually expecting to receive.
- After the details of income, all the expenses that the company expects to incur for the period under consideration will be entered. These expenses are further categorized into fixed and variable expenses to provide a clear picture of the nature of the expenses. However, the category can be modified in the template as per the requirement of the person.
- After that template will automatically calculate the balance left after subtracting the total expenses from the total income of the person. Since this is the zero-based budget, the difference between the income and expenses of the period should be equal to zero. So, till the time this balance comes to zero people have to make modifications in order to get this difference as zero.
- After the budgeted details, the figures for actual income received and actual expenses incurred for the period against each activity should be entered.
- From the above figures variance will be calculated automatically by deducting actual figures from the budgeted figures for all the activities individually and for the total budget as a whole.
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This has been a guide to Zero Based Budget Template. Here we provide you with a free downloadable zero-based budget spreadsheet in order to justify the expenses for each of the new periods. Also, you can download and use this template in Excel, Google Sheets or in PDF format.
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