The Kalgan Driftwood Company has decided to that it needs to use the budgeting process much more substantially to manage its activities. You are a graduate trainee who has just started work in the accounting department of Kalgan. In your degree studies, you completed a module called Managerial Finance and learned that budgets serve a number of useful purposes including:
1. Motivating managers to strive to achieve the organisational goals;
2. Evaluating the performance of managers
explain these two purposes.