What is a Budget?
Simply stated, a budget is a quantified, planned course of action over a definitive time period. It is an attempt to estimate inputs and the costs of inputs along with associated outputs and revenues from outputs. Creating a budget is important because it:

Forces an organization to carefully consider the expected demand for its products and services and the resources required to meet that demand
Translates the organization's higher priorities into the appropriate resources required to achieve those priorities
Highlights potential problems in sufficient time to take corrective actions
Creates a baseline against which actual results can be compared.