IREM Certified Property Manager (CPM) Practice Test 2025 – All-in-One Guide to Exam Success!

The basic purpose of an operating budget is to manage day-to-day expenses. An operating budget serves as a financial plan that outlines expected income and expenses over a specific period, typically a year. This budget includes all operational costs, such as utilities, maintenance, payroll, and materials needed for daily business activities. By providing a structured way to allocate resources, an operating budget helps property managers ensure that expenses are aligned with the operational goals of the property. It allows for better financial control, decision-making, and strategic planning to maintain a stable and efficient operation.

While the other options relate to financial and operational aspects, they do not capture the core function of an operating budget as effectively. Tracking employee performance focuses more on Human Resources management, forecasting expenses for non-operating income does not pertain directly to operational activities, and keeping a log of repairs is more about maintenance tracking rather than budgeting.