Which items are typically included in an operating budget?

An operating budget is primarily focused on the company’s day-to-day activities and outlines the expected revenues and expenses that will be incurred during a specific period, usually a year. This budget serves as a financial plan for managing the operational activities necessary to generate income and control expenses. By projecting revenues from sales and the related operational expenses—such as salaries, utilities, and cost of goods sold—businesses can gauge their short-term financial performance and make informed decisions accordingly.

The other items referenced in the choices either relate to capital budgeting or broader financial planning rather than the operational scope intended by an operating budget. Long-term investments and asset purchases are typically covered in capital expenditure budgets, while all cash inflows and outflows for the year would be part of a cash flow budget. Estimates of capital expenditures and financing also pertain to longer-term investment strategies rather than the immediate operational focus.