Certified Supplier Quality Professional (CSQP) Practice Exam

An approved written plan of the total costs and cash inflows for a project is referred to as what?

1. A budget

2. A forecast

3. Actual costs and revenues

4. A variance

The correct answer is: A budget

The correct term for an approved written plan detailing the total costs and cash inflows for a project is a budget. A budget serves as a financial blueprint that outlines expected expenditures and revenues, helping to manage and allocate resources efficiently throughout the project's lifecycle. It establishes a framework within which project performance can be measured, allowing stakeholders to track progress and make informed decisions regarding expenses and investments. While a forecast is concerned with predicting future financial performance based on historical data and trends, it does not serve as an approved plan. Actual costs and revenues refer to the real expenses and income incurred during the project, reflecting performance rather than planned amounts. A variance represents the difference between budgeted figures and actual performance, which is not a plan itself, but a measurement that provides insight into how well the project is adhering to its budget. Thus, a budget is fundamentally focused on outlining the expected financial framework for a project.