Do you think you know all you need to know about grant budgets? Take this mini-quiz to test your basic knowledge. The answers are at the end of the quiz.  Come back for more quizzes like this one in the future.

1. What is the first step in creating a good grant budget?

A) Determine the project’s goals and objectives

B) Estimate the project’s expenses

C) Research potential funding sources

D) Draft the project narrative

2. What should be included in grant budgets?

A) Expenses related to the project

B) Only salaries and supplies

C) Only grant-related expenses, such as equipment and travel

D) Only direct costs, such as salaries and benefits

E) Whatever the funder says should be included

F) A and E

G) A and C

3. What is an indirect cost rate?

A) A percentage added to the project budget to cover overhead expenses

B) A grant application fee charged by most private foundations

C) A fee charged to cover the costs of grant administration

D) A number set by the federal government that determines how much funding a project is eligible to receive

4. What is a “matching requirement” in a grant proposal?

A) The funds the grantee must contribute to the project in addition to amount requested

B) A requirement to provide matching funds equal to or greater than the grant amount

C) A requirement to match program goals with the mission of the funding source

D) A requirement to identify potential matches between the program and the funders’ priorities

5. What should be included in the budget justification section of a grant proposal?

A) A detailed description of how each budget item relates to the project activities

B) A list of all the project’s expenses

C) A statement outlining the grantee’s financial need

D) A list of potential funders that could provide additional support

Answers:

1. A) Determine the project’s goals and objectives. It’s nor fair for me to start off with a trick question, is it? All of these choices are things you need to consider when creating your grant budget, but the one that should come first is determining your project’s goals and objectives. Every expenditure should align with your goals and objectives. 

2. F) A. All expenses related to the project and E. Whatever the funder says should be included. OK, this one is tricky, too.  A, B, C, D, and E could be correct, based on E (“Whatever the funder says should be included”), but only A and C are always correct. The most important thing is to include whatever the funder says should be included. Period. That’s just part of following the instructions, right? 

3. A) A percentage added to the project budget to cover overhead expenses. Indirect costs are intended to cover overhead expenses. Most funders allow indirect costs in abudget, but some do not. Government grants have some pretty clear rules governing indirect costs. Watch for a future blog post about indirect costs to help you better understand these costs.

4. A) The funds the grantee must contribute to the project in addition to amount requested. Not all funder’s require a match, and those that do can request it in many different ways — cash, in-kind contributions, a combination of cash and in kind, a percentage of the total grant costs, a flat amount, a contribution of a particular component (e.g., a specific person’s salary, etc.). I could go on. As always, review the funder’s requirements carefully.

5. A) A detailed description of how each budget item relates to the project activities. The budget justification should include your description of the costs included in the budget, how you arrived at those numbers (i.e., how you calculated them), their relationship to project activities, and their relationship to project goals and objectives. Of course you should follow the funder’s requirements for what should be included in the budget justification (sometimes called the budget narrative), but this is a good standard for what should be included.

How did you do with your quiz on grant budgets?

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