Acc 560 Wk 7 Quiz 9

ACC 560 WK 7 Quiz 9
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1. Budgets are statements of management's plans stated in financial terms.


2. A benefit of budgeting is that it provides definite objectives for evaluating performance.


3. A budget can be a means of communicating a company's objectives to external parties.


4. A budget can be used as a basis for evaluating performance.

5. A well-developed budget can operate and enforce itself.


6. The budget itself and the administration of the budget are the responsibility of the accounting department.


7. Effective budgeting requires clearly defined lines of authority and responsibility.


8. The flow of input data for budgeting should be from the highest levels of responsibility to the lowest.


9. Budgets can have a positive or negative effect on human behavior depending on the manner in which the budget is developed and administered.


10. A budget can facilitate the coordination of activities among the segments of a large company.


11. The longer the budget period, the more reliable the estimates of future outcomes.

12. The budget committee has the responsibility for coordinating the preparation of the budget.

13. The budget is developed within the framework of a sales forecast.

14. Budgeting and long-range planning are two terms that describe the same process.


15. Long-range plans are used more as a review of progress toward long-term goals rather than an evaluation of specific results to be achieved.

16. The master budget reflects management's long-term plans encompassing five years or more.


17. The master budget consists of operating and financial budgets.

18. Financial budgets must be completed before the operating budgets can be prepared.


19. The direct materials budget must be completed before the production budget because the quantity of materials available for production must be known.

20. The...