Building a perfect budget is nearly impossible, especially with when so many things may be in flux, particularly in an organization’s external environment. However, CFOs must perform this difficult task by performing diligent, and sometimes creative, analyses of cash flows, projected income statements, and projected balance sheets. There are many steps to the budgeting process a CFO performs.Please describe in detail these steps.

Building a perfect budget is nearly impossible, especially with when so many things may be in flux, particularly in an organization’s external environment. However, CFOs must perform this difficult task by performing diligent, and sometimes creative, analyses of cash flows, projected income statements, and projected balance sheets. There are many steps to the budgeting process a CFO performs.Please describe in detail these steps.

Managerial Accounting

15th Edition

ISBN:9781337912020

Author:Carl Warren, Ph.d. Cma William B. Tayler

Publisher:Carl Warren, Ph.d. Cma William B. Tayler

Chapter8: Budgeting

Section: Chapter Questions

Problem 2DQ: Briefly describe the type of human behavior problems that might arise if budget goals are set too...

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Which of the following is NOT an objective of the budgeting process? Group of answer choices a - To communicate management's plans throughout the entire organization b - To ensure that the company continues to grow. c - To uncover potential bottlenecks before they occur d - To provide a means of allocating resources to those parts of the organization where they can be used most effectively.
Benefits of Budgeting include all of the following EXCEPT: A) Promotes analysis of results B) Creates an early warning system C) Facilitates coordination of activities within the company D) Motivate personnel with challenging, frustrating, and unrealistic goals
Budgeting can be an important management tool if implemented properly. Identify several positive results when budgets are used properly. Since budgets affect people, identify several negative aspects if budgets are not implemented properly. Additionally, please discuss in detail how the budgeting process is essential to managers.
1. Which of the following is NOT an objective of the budgeting process? a. O a. To communicate management's plans throughout the entire organization O D.To provide a means of allocating resources to those parts of the organization where they can be used most effectively С. To ensure that the company continues to grow OTo uncover potential bottlenecks before they occur
Budgeting is an important process as managerial decisions involving budgets may have far-reaching impacts on multiple levels within an organization. Hence, such decisions must be considered thoroughly before being implemented. For this forum, identify four reasons that capital budgeting decisions are risky. Ensure to justify your answer.
Which of the following is true in a bottom-up budgeting approach? a.Supervisors tell departments their budget amount and the departments are free to work within those amounts. b.Departments determine their needs and relate them to the overall goals. c.Every expense needs to be justified. d.Departments budget their needs however they see fit.
Which of the following is NOT true of the budgeting process? Question 8 options: Budgeting provides feedback to management to aid in assessing how well it's reaching its goals. Budgets force managers to plan for the future. Budgets force managers to consider relations among operations across the entire value chain. The performance report is prepared as part of the master budget.
Many accountants believe that the most important benefit of the master budgeting process is the endresult: a set of pro forma financial statements. What is the rationale for this view?
There are a number of benefits associated with budgeting. Which of the following is not frequently cited as a benefit of the budget process? Budgets help to monitor and control operations. Budget eliminates the opportunity for slack or padding within an organisation. Budgets provides a method of allocating and using resources within the organisation. Budget are an early warning system. They highlight where investigation and appropriate correction action is necessary.
The first step of the budget process is: plan direct control feedback Static budget are often used by: production department. administrative departments. responsible centers. capital projects. A budget serves as a benchmark against which Actual results can be compared. Allocated results can be compared. Actual results become inconsequential. Allocated results become inconsequential. The following are characteristics of an effective budget, EXCEPT: Goals should be attainable. Evaluations should be made carefully with opportunities to explain any failures. They should be properly applied to avoid negative effects. Customers affected by a budget should be consulted when it is prepared. Which of the following is NOT a benefit of budgeting? It forces managers to look to the future. It plays an important role in communication within the organization. It serves an important role in motivating and rewarding employees. It encourages executives to build up organizational slack.…
b) ‘Budgeting has a number of different purposes including: Planning; Control; Performance evaluation; Motivation. Some managers believe that zero-based budget is more beneficial than other types of the budget for firms.’ Required: Critically discuss the above statement with reference to academic literature. In your discussion, you should refer to the budgeting systems you learned in this module.
Why do the authors suggest that a thorough review of the firm’s chart of accounts, account classifications, and reporting systems are a must before initiating a budgeting and planning system?