#1
What is the primary purpose of budgeting in managerial control?
To allocate resources efficiently
ExplanationEfficient resource allocation.
#2
Which budgeting method involves preparing budgets for various levels of activity?
Flexible budgeting
ExplanationBudgets adjusted for activity levels.
#3
Which budgeting approach requires justifying all expenses from scratch for each budgeting period?
Zero-based budgeting
ExplanationExpense justification per period.
#4
In budgetary control, a favorable variance indicates that:
Actual results exceed budgeted amounts
ExplanationActual exceeds budgeted.
#5
What is the primary purpose of a master budget?
To coordinate and summarize all budgeting activities
ExplanationCoordinate and summarize budgeting.
#6
Which budgeting approach involves making adjustments based on actual performance?
Flexible budgeting
ExplanationAdjustments based on actuals.
#7
What is the key benefit of participative budgeting?
Higher employee morale and commitment
ExplanationBoosting morale and commitment.
#8
Which budgeting technique allows for adjustments based on changes in activity levels?
Flexible budgeting
ExplanationActivity-based adjustments.
#9
What is the main limitation of static budgeting?
It cannot accommodate changes in activity levels
ExplanationInflexible to activity changes.
#10
Which budgeting method emphasizes continuous improvement and cost reduction?
Kaizen budgeting
ExplanationFocus on improvement and cost reduction.
#11
What is the main advantage of rolling budgets?
They provide a long-term perspective while allowing for short-term adjustments
ExplanationLong-term perspective with short-term adjustments.
#12
In which budgeting approach are budgets prepared for various levels of activity and updated as conditions change?
Flexible budgeting
ExplanationActivity-based and adaptable budgets.
#13
Which budgeting method involves setting budgets based on the activities required to produce goods or services?
Activity-based budgeting
ExplanationBudgets tied to production activities.