Budgeting and Financial Management
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Budgeting and Financial Management

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Questions and Answers

What is the primary responsibility of the chief executive of a firm regarding budget administration?

  • Delegating the budget responsibility
  • Administering the budget (correct)
  • Approving the budget
  • Preparing the budget
  • What type of budget is used for significant investments in projects with long-term implications?

  • Master budget
  • Capital budget (correct)
  • Financial budget
  • Operating budget
  • Who is responsible for justifying changes made to the previous budget?

  • Managers (correct)
  • Chief executive
  • Controller
  • Budget committee
  • What is the purpose of an operating budget?

    <p>To project revenues, expenses, and results of operations</p> Signup and view all the answers

    Who may the chief executive delegate the budget responsibility to?

    <p>Any of the above</p> Signup and view all the answers

    What is a financial budget related to?

    <p>Budget of financial resources reflected in the budgeted balance sheet</p> Signup and view all the answers

    What is the book value of Property, Plant and Equipment (PPE) as of December 31?

    <p>2,800,000.00</p> Signup and view all the answers

    What is the total amount of unpaid accounts payable as of December 31?

    <p>349,602.0</p> Signup and view all the answers

    What is the net income for the period ending June 30?

    <p>307,650.00</p> Signup and view all the answers

    What is the main purpose of a budget?

    <p>To control and plan financial activities</p> Signup and view all the answers

    Who is responsible for preparing and administering budgets?

    <p>Managers</p> Signup and view all the answers

    What is the master budget?

    <p>A summary of all budgets</p> Signup and view all the answers

    What is the primary function of a budgeting schedule?

    <p>To answer who, what, and when questions</p> Signup and view all the answers

    What is the purpose of a responsibility accounting system?

    <p>To identify cost drivers and activity centers</p> Signup and view all the answers

    What is the main benefit of financial modeling?

    <p>It allows for the evaluation of alternative scenarios</p> Signup and view all the answers

    What is the primary goal of participatory budgeting?

    <p>To involve every manager in planning and control</p> Signup and view all the answers

    What is a potential conflict that may arise in a budget system?

    <p>Between planning and control</p> Signup and view all the answers

    What is the purpose of tying performance to compensation?

    <p>To motivate managers to achieve their unit's budget goals</p> Signup and view all the answers

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