Consider the following statements about zero-base budgeting:I. The budget for virtually every activity in an organization is initially set tothe level that existed during the previous year.II. The budget forces management to rethink each phase of an organization'soperations before resources are allocated.III. To receive funding for the upcoming period, individual activities must bejustified in terms of continued usefulness to the organization.Which of the above statements is (are) true?A. II only.B. III only.C. I and II.D. II and III.E. I, II, and III.

It is true that under the traditional budgeting process, we see Statement I coming under practice;…

Answered: Consider the following statements about…

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter7: Budgeting

Section: Chapter Questions

Problem 11MC: Which of the following statements is not correct? A. The sales budget is computed by multiplying...

See similar textbooks

Similar questions

Which approach is most likely to result in employee buy-in to the budget? A. top-down approach B. bottom-up approach C. total participation approach D. basing the budget on the prior year
Why might a rolling budget require more management participation than an annual budget?
Which budget evaluates the results of operations at the actual level of activity? capĂtal budget cash budget flexible budget static budget
Which of the following statements is not correct? A. The sales budget is computed by multiplying estimated sales by the sales price. B. The production budget begins with the sales estimated for each period. C. The direct materials budget begins with the sales estimated for each period. D. The sales budget is typically the first budget prepared.
Which of the operating budgets is prepared first? A. production budget B. sales budget C. cash received budget D. cash payments budget
Which of the following is not considered a benefit of the budgeting process? a. Gives managers guidance when evaluating the performance of business operations. b. Determines the exact amount of revenues and expenses for the upcoming fiscal period. c. Helps managers achieve short-term and medium-term goals. d. Helps managers set long-term strategic plans.
Which budget activity at the start of each year is set as "zero"?Select one:a. Incremental Budgetingb. Zero based budgetingc. Activity based budgetingd. Base budgeting
Which of the following is NOT one of the essentials of a budget? Select one: a. It has a standard time period and prepared only on a yearly basis. b. It is a predetermined statement and its purpose is to attain a given objective c. It is prepared for a definite future period. d. It is a statement prepared prior to a defined period of time.
Which of the following is a correct definition of budget? Select one: O a. A statement which includes the strategic objectives of a company to be achieved in the long term. O b. A financial and/or quantitative statement, prepared and approved prior to define period of time, of the policy to be pursued during that period for the purpose of attaining a given objective O c. A financial statement which reports the achieved and not achieved objectives of the company for a period of time. O d. A financial and/or quantitative statement, prepared and approved after a define period of time, of the policy pursued during that period for the purpose of evaluating the objectives achieved.
Which is the mostly likely purpose of budgeting? a. Assess the non-financial performance of an organization b. Planning and control of an organization's income and expenditure C.Preparation of a five-year business plan d. Company valuation
The "Cash Budget" a)is used to predict future surpluses & shortages of cash, allowing the organization to plan ahead for such occurrences b)differs from the Master Budget due to the accrual concept c)uses the Master & Capital budgets for input d)all of the listed answers are correct
(Management Accounting) In practice, when developing a budget, two extremes used for guidance are ________ and ________. A) participative budget; zero-base budget B) strategic budget; long-range budget C) financial planning budget; strategic budget D) zero-base budget; activities of current or prior period

SEE MORE QUESTIONS

Recommended textbooks for you

Principles of Accounting Volume 2

Accounting

ISBN:

9781947172609

Author:

OpenStax

Publisher:

OpenStax College

Principles of Cost Accounting

Accounting

ISBN:

9781305087408

Author:

Edward J. Vanderbeck, Maria R. Mitchell

Publisher:

Cengage Learning

Managerial Accounting

Accounting

ISBN:

9781337912020

Author:

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

Publisher:

South-Western College Pub

Principles of Accounting Volume 2

Accounting

ISBN:

9781947172609

Author:

OpenStax

Publisher:

OpenStax College

Principles of Cost Accounting

Accounting

ISBN:

9781305087408

Author:

Edward J. Vanderbeck, Maria R. Mitchell

Publisher:

Cengage Learning

Managerial Accounting

Accounting

ISBN:

9781337912020

Author:

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

Publisher:

South-Western College Pub

SEE MORE TEXTBOOKS