1. Budgets can have a positive or negative effect on human behaviordepending on the manner in which the budget is developed and administered.2. The direct materials budget must be completed before the productionbudget because the quantity of materials available for production must beknown.3. The starting point in developing the master budget is the preparation of theproduction budget.4. In a production budget, if the number of units in finished goods inventory atthe end of the period is less than the number of units in finished goodsinventory at the beginning of the period, then the expected number of unitssold is less than the number of units to be produced during the period.5. The direct labor budget begins with the required production in units fromthe production budget.Which of the above statements are FALSE?

A budget is a financial structure or plan which are prepared based on historical and current…

1. Budgets can have a positive or negative effect on human behavior depending on the manner in which the budget is developed and administered. 2. The direct materials budget must be completed before the production budget because the quantity of materials available for production must be known. 3. The starting point in developing the master budget is the preparation of the production budget.

1. Budgets can have a positive or negative effect on human behavior depending on the manner in which the budget is developed and administered. 2. The direct materials budget must be completed before the production budget because the quantity of materials available for production must be known. 3. The starting point in developing the master budget is the preparation of the production budget.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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