All of the following are advantages of the use of budgets in a management control system except that budgets
A. Force management planning.
B. Provide performance criteria.
C. Promote communication and coordination within the organization.
D. Limit unauthorized expenditures. Correct Answer-D. Li...
ACCT 3300 Ch 10(1) Questions with Correct Answers
All of the following are advantages of the use of budgets in a
management control system except that budgets
A. Force management planning.
B. Provide performance criteria.
C. Promote communication and coordination within the organization.
D. Limit unauthorized expenditures. Correct Answer-D. Limit
unauthorized expenditures.
In the budgeting and planning process for a firm, which one of the
following should be completed first?
A. Sales budget.
B. Financial budget.
C. Cost management plan.
D. Strategic plan. Correct Answer-D. Strategic plan.
Which one of the following best describes the role of top management in
the budgeting process? Top management
A. Should be involved only in the approval process.
B. Lacks the detailed knowledge of the daily operations and should limit
their involvement.
C. Needs to be involved, including using the budget process to
communicate goals.
,D. Needs to separate the budgeting process and the business planning
process into two separate processes. Correct Answer-C. Needs to be
involved, including using the budget process to communicate goals.
Which one of the following is usually not cited as being an advantage of
a formal budgetary process?
A. Forces management to evaluate the reasonableness of assumptions
used and goals identified in the budgetary process.
B. Ensures improved cost control within the organization and prevents
inefficiencies.
C. Provides a formal benchmark to be used for feedback and
performance evaluation.
D. Serves as a coordination and communication device between
management and subordinates. Correct Answer-B. Ensures improved
cost control within the organization and prevents inefficiencies.
The major objectives of any budget system are to
A. Define responsibility centers, provide a framework for performance
evaluation, and promote communication and coordination among
organization segments.
B. Define responsibility centers, facilitate the fixing of blame for missed
budget predictions, and ensure goal congruence between superiors and
subordinates.
C. Foster the planning of operations, provide a framework for
performance evaluation, and promote communication and coordination
among organization segments.
, D. Foster the planning of operations, facilitate the fixing of blame for
missed budget predictions, and ensure goal congruence between
superiors and subordinates. Correct Answer-C. Foster the planning of
operations, provide a framework for performance evaluation, and
promote communication and coordination among organization segments.
One of the primary advantages of budgeting is that it
A. Does not take the place of management and administration.
B. Bases the profit plan on estimates.
C. Is continually adapted to fit changing circumstances.
D. Requires departmental managers to make plans in conjunction with
the plans of other interdependent departments. Correct Answer-D.
Requires departmental managers to make plans in conjunction with the
plans of other interdependent departments.
A budget helps a company control costs by setting cost guidelines.
However, a budget also performs the function(s) of
A. Planning.
B. Motivating.
C. Communicating.
D. All of the answers are correct. Correct Answer-D. All of the answers
are correct.
An improperly executed budget process might have the effect(s) of
A. Disregard of overall company goals.
B. Inflated budget requests.
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