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- Which of the following statements are TRUE? I. Responsibility accounting attempts to assign blame for problems to a specific manager.II. One benefit of a budget is that it helps managers gather relevant information for improving future performance.III. Challenging budgets tend to motivate improved performance.IV. Controllability may be difficult to pinpoint because some costs are the result of the market, not the manager.1. A budget is a detailed financial plan that quantifies future expectations and actions relative to acquiring and using resources. a. True b. False 2. Budgets should not be used to provide managers with “pre-approval” for the execution of spending plans. a. True b. False 3. A flexible budget is not designed to change with changes in activity level. a. True b. False 4. The production budget comes before the materials purchases budget. a.True b. False 5. The starting point for the master budget is an assessment of anticipated production next year. a. False b. TrueWhich of the following is not a benefit of budgeting? O Provide a way to measure business performance Help managers communicate expectations and quickly. spot deviations Keep managers focussed on financial implications of their business decisions O Provide a way to hire specialized labors
- PLEASE ANSWER ALL TRUE OR FALSE 4. A usually effective way of forecasting sales is to rely entirely on the predictions of the individual sales people and sales managers of the organization.5. The operating budget includes the budgeted balance sheet and the sales budget.. It is an important use of managerial accounting a. determine direct cost by adding direct materials b. understand customer orientation c. recast budgeted statements according to a situation d. change variables of risk internally and externallyWhich of the following is true in a bottom-up budgeting approach? Every expense needs to be justified. Supervisors tell departments their budget amount and the departments are free to work within those amounts. Departments budget their needs however they see fit. Departments determine their needs and relate them to the overall goals.
- The best that describes the top management's role in budgeting process is that top management 1. Should be involved only in the approval process 2. Lacks the detailed knowledge of the daily operations and should limit their involvement 3. Needs to be involved, including using the budget process to communicate goals 4. Needs to separate the budgeting process and business planning process into two separate processes O 1 O 2 3. O 4True or False 1. Budgets should not be used to motivate and reward employees. 2. Budgets play an important communication role within organizations. They provide a mechanism for managers to share expectations and priorities for the future. 3. Budgets also provide useful benchmarks for evaluating and rewarding employee performance.A budget: A.is used to determine if a product should be continued or discontinued B.complies actual costs for a given period C.quantifies management's plans D.determines and evaluates the cost of specific products or activities in a business
- If a manager builds slack into a budget, how would that manager handle estimates of revenues and expenses? Revenues A. Underestimate B. Underestimate C. Overestimate Expenses Underestimate Overestimate С. Underestimate D. Overestimate Overestimate Е. Estimate Estimate correctly correctlyManagerial accounting is an activity that helps managers determine the costs of an organization's products and services, plan future activities, and compare actual results to planned results. True or False True Prey False 1 of 32 Next >1 i. Discuss the factors that are likely to cause managers to submit budget estimates of sales and costs that do not represent their best estimate or expectations of what will actually occur. ii. Suggest, as a budget accountant, what procedures you would advise in order to minimize the likelihood of such biased estimate arising.