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A director is looking to purchase new playground equipment for his existing child care center; which type of budget should he make?

a. Operational budget
b. Capital budget
c. Emergency budget
d. Contingency budget

User Limc
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1 Answer

2 votes

Final answer:

The director should make a capital budget since this is used for long-term investments like purchasing playground equipment for an existing child care center.

Step-by-step explanation:

A director looking to purchase new playground equipment for an existing child care center should prepare a capital budget. This type of budget is designed for long-term investments or for the purchase of fixed assets that will be used over an extended period of time. Playground equipment is a substantial, long-term asset that falls under capital expenditures, which are typically for the acquisition, improvement, or maintenance of long-term assets such as property, buildings, or equipment.

An operational budget would cover the day-to-day running costs of the child care center, while an emergency budget is reserved for unforeseen circumstances, and a contingency budget is allocated for unexpected events or costs during a project. Therefore, the correct answer here is b. Capital budget.

User Mr Singh
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