Which statement best describes a budget that is most likely to motivate?
A budget that is too difficult to achieve is more likely to motivate than a budget that is too easy or that is tight but attainable. C. A budget that is tight but attainable is more likely to motivate than a budget that is too easy or too difficult to achieve.
What must the budget amounts be based on?
The budget amounts must be based on those of previous accounting periods. b. The company's budget should be a good substitute for management. c. Managers must be held responsible for controllable and uncontrollable costs.
What is the main purpose of a business budget?
Budgeting facilitates the coordination of activities within the business by correlating the goals of each segment with overall company objectives. true Which one of the following is not a benefit of budgeting? a. It provides definite objectives for evaluating performance.
Is the company's budget a good substitute for management?
The company's budget should be a good substitute for management. c. Managers must be held responsible for controllable and uncontrollable costs. d. The company must have a sound organizational structure.
Which of the following are benefit of budgeting?
A budget helps create financial stability. By tracking expenses and following a plan, a budget makes it easier to pay bills on time, build an emergency fund, and save for major expenses such as a car or home. Overall, a budget puts a person on stronger financial footing for both the day-to-day and the long term.
Which of the following is not a purpose of budgeting?
The correct answer is option D. Preventing net operating losses is not a part of budgeting.
Which of the following is not the advantage of budgeting?
A budget does not give greater control to lower management. Proper budgeting helps the management in getting out of just doing things the same way and noticing what can be improved. Proper budgeting is the primary step in achieving the company's long-term goals.
What are 4 benefits of a budget?
Benefits of budgeting include providing "guardrails" (i.e., designated limits) for spending, achieving financial goals (if savings is included as a fixed "expense"), and for peace of mind.
Which of the following activities is not part of the budgeting process?
Th budget process involves doing all the following except: Dismissing all managers who fail to achieve operational goals specified in the budget. The budgeting process does not involve which of the following activities: Increase of sales by increasing marketing efforts.
Which one of the following is not a functional budget *?
R&D budget, cash budget, and purchase budget are included in a functional budget. Therefore, direct labor cost is not included in a functional budget.
What are disadvantages of budgeting?
The Disadvantages of BudgetingInaccuracy. ... Rigid decision making. ... Time required. ... Gaming the system. ... Blame for outcomes. ... Expense allocations. ... Use it or lose it. ... Only considers financial outcomes.
What are the advantages and disadvantages of budgeting?
Comparison Table for Advantages and Disadvantages of BudgetAdvantagesDisadvantagesA budget assists the business schemes throughout with the best utilization of the available resources.Sometimes the budgeting might be very costly than the actual business plan which may or may not be affordable by all types of companies.5 more rows•Apr 20, 2022
What are the benefits of budgeting quizlet?
What are the four benefits of budgeting? Identifies spending priorities, prevents potential conflicts with loved ones, aids the development of a financial plan, and encourages good stewardship.
What are the five purposes of budgeting?
The objectives of budgetingProvide structure. A budget is especially useful for giving a company guidance regarding the direction in which it is supposed to be going. ... Predict cash flows. ... Allocate resources. ... Model scenarios. ... Measure performance.
What are the three main purposes of budgeting?
In the context of business management, the purpose of budgeting includes the following three aspects: A forecast of income and expenditure (and thereby profitability) A tool for decision making. A means to monitor business performance.
How does budgeting facilitate the coordination of activities within the business?
Budgeting facilitates the coordination of activities within the business by correlating the goals of each segment with overall company objectives.
What is budget based on?
a. The budget amounts must be based on those of previous accounting periods.
How long is a budget period?
The most common budget period is one month.
Who prepares the budget?
a. The budget committee must prepare the budget.
Do essentials of effective budgeting include essentials of effective budgeting?
The essentials of effective budgeting do not include
What would happen if budget targets were difficult to meet?
D) If budget targets are difficult to meet, employees could turn to fraudulent financial reporting.
What does "b" mean in a statement of expectations?
B) presents a statement of expectations for a period of time but does not present a firm commitment.
Do conflicts of interest arise when employees are asked for input to help establish a budget?
A) Conflicts of interest do not arise when employees are asked for input to help establish a budget.
Is Oklahoma Telephone Company forced to budget?
Oklahoma Telephone Company has been forced by competition to put much more emphasis on planning and controlling its costs. Accordingly, the company's controller has suggested initiating a formal budgeting process.
