What is a master budget?

A master budget is a detailed financial plan that projects a company's anticipated revenues, expenses, and profits for a specific period, usually a fiscal year. It typically comprises various smaller budgets that cover different aspects of the business, such as the operating budget, capital budget, and financial budget.

An operating budget, on the other hand, is a budget that itemizes a company's expected revenues and expenses related to its everyday operations. These may include costs such as salaries, rent, utilities, and supplies, among others.

Apart from the operating and master budgets, there are several other types of budgets that businesses may use. These include the capital budget, which outlines a company's anticipated long-term asset expenditures, such as land, equipment, and buildings. The financial budget is another type that highlights a business's expected cash inflows and outflows. Additionally, there is the sales budget, which shows a company's predicted sales revenues, the production budget, which outlines the expected costs of producing goods or services, and the research and development budget, which projects a business's anticipated expenses on research and development activities.