Answered: 1. The organizational process of…

1. The organizational process of budgeting performs several important functions. Which is true? A. Assigns decision rights B. Shares knowledge C Measures performance D. All of the choices are correct

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter7: Budgeting

Section: Chapter Questions

Problem 6MC: Which of the following is true in a bottom-up budgeting approach? Every expense needs to be...

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Question

1. The organizational process of budgeting performs several important functions. Which is true?
A. Assigns decision rights
B. Shares knowledge
C. Measures performance
D. All of the choices are correct

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Which approach requires management to justify all its expenditures? A. bottom-up approach B. zero-based budgeting C. master budgeting D. capital allocation budgeting
Why is a clear understanding of managements goals and objectives necessary for effective budgets?
Which of the following is not a part of budgeting? A. planning B. finding bottlenecks C. providing performance evaluations D. preventing net operating losses
If management is being evaluated on their ability to manage a budget, what can they do to increase cash flow?
Which of the following is true in a bottom-up budgeting approach? Every expense needs to be justified. Supervisors tell departments their budget amount and the departments are free to work within those amounts. Departments budget their needs however they see fit. Departments determine their needs and relate them to the overall goals.
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Which of the following is not an accepted principle of effective budgeting? A• Flexibility B• Top management support C• Communication of results D• Responsibility accounting
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1) Explain the concept of contribution and limiting factors and how it can be effectively used in decision making2) Explain what you understand by Budgets, Fixed Budgets and Flexible Budgets in the context of controland performance evaluation of an organization of your choice.