Each of the following statements includes a pair of words within parenthesis. Indicate which of the words should be chosen to make the statement true. The first statement is done as an example. A ( loan application / budget ) is a detailed financial plan that quantifies future expectations and actions relative to acquiring and using resources. Budgets ( should / should not ) be used to provide managers with "preapproval" for execution of spending plans. The (master budget / sales budget ) is a comprehensive document specifying sales targets, production activities, and financing actions. "Responsibility accounting" is a concept under which managers are held
Master Budget
A master budget can be defined as an estimation of the revenue earned or expenses incurred over a specified period of time in the future and it is generally prepared on a periodic basis which can be either monthly, quarterly, half-yearly, or annually. It helps a business, an organization, or even an individual to manage the money effectively. A budget also helps in monitoring the performance of the people in the organization and helps in better decision-making.
Sales Budget and Selling
A budget is a financial plan designed by an undertaking for a definite period in future which acts as a major contributor towards enhancing the financial success of the business undertaking. The budget generally takes into account both current and future income and expenses.
Each of the following statements includes a pair of words within parenthesis. Indicate which of the words should be chosen to make the statement true. The first statement is done as an example.
- A ( loan application / budget ) is a detailed financial plan that quantifies future expectations and actions relative to acquiring and using resources.
- Budgets ( should / should not ) be used to provide managers with "preapproval" for execution of spending plans.
- The (
master budget / sales budget ) is a comprehensive document specifying sales targets, production activities, and financing actions. - "Responsibility accounting" is a concept under which managers are held accountable for transactions and events
- ( beyond / under ) their direct influence and control.
- Some entities will follow a top-down( mandated / participative ) approach to budgeting.
- A deliberate effort to create "breathing room" within a budget is known as ("padding the budget" / "aerating" ).
- With ( incremental budgeting / zero-based budgeting ), each expenditure item must be justified for the new budget period.
- The starting point for the master budget is an assessment of anticipated ( sales / production ).
- A ( static budget / flexible budget ) is not designed to change with changes in activity level.
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