What does the capital budget primarily deal with?

The capital budget primarily deals with upgrades or maintenance costs for physical plants because it focuses on long-term investments in fixed assets. This includes expenditures on property, equipment, and major improvements that are expected to provide benefits over several years. When organizations plan their capital budgets, they consider the costs of buying new machinery, expanding facilities, or making significant repairs that enhance operational efficiency and productivity.

In contrast, the other options pertain to different budgeting areas. Forecasting sales revenue is part of operational budgeting, which deals with expected income and expenses related to day-to-day operations. Employee salaries and benefits are typically managed within payroll or human resources budgeting, which focuses on compensation-related expenses for personnel. Marketing and advertising expenses fall under marketing budgets, where costs related to promoting products and services are allocated. Thus, the capital budget is specifically aligned with long-term asset management rather than routine operational costs.