Accounting 203
1. The term planning involves
a. the development of future objectives and the preparation of
various budgets to achieve these objectives.
b. the steps taken to ensure that objectives set down by management
are attained.
c. the steps taken to ensure that all parts of the organization
function in a manner consistent with organizational policies.
d. comparing budgeted and actual results and taking steps to remedy
unacceptable variations.
2. Self-imposed budgets typically are
a. not subject to review by higher levels of management since to do
so would contradict the participative aspect of the budgeting
processing.
b. not subject to review by higher levels of management except in
specific cases where the input of higher management is required.
c. subject to review by higher levels of management in order to
prevent such self-imposed budgets from becoming too loose and
allowing too much freedom in activities.
d. not critical to the success of a budgeting program.
3. Which of the following statements is not correct?
a. The sales budget is the starting point in preparing the master
budget.
b. The sales budget is constructed by multiplying the expected
sales in units by the sales price.
c. The sales budget generally is accompanied by a computation of
expected cash receipts for the forthcoming budget period.
d. The cash budget must be prepared prior to the sales budget
since managers want to know the expected cash...
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