FELE Finance Practice Test 2025 – 400 Free Practice Questions to Pass the Exam

The program budget is designed specifically to allocate resources based on the goals and objectives of various programs within an organization. This budgeting method emphasizes the importance of specific programs, ensuring that funding is directed toward activities that align with the organization’s broader strategic goals.

By using a program budget, organizations can better track the costs associated with each program, assess their effectiveness, and make informed decisions regarding the continuation, modification, or termination of specific initiatives. It facilitates a more organized approach to budgeting by grouping together all costs associated with a particular program rather than just listing expenses by type of expense.

In contrast, other budgeting methods focus on different aspects: the incremental budget is based on making slight adjustments to previous budgets, the performance budget connects expenditures to measurable outcomes, and the line-item budget emphasizes detailed itemization of each expense rather than aligning with programmatic objectives. This distinction underscores why the program budget is the most suitable choice for focusing on maintaining specified programs.