Exercise 20-2 Budget definitions LO C1 Select each of the terms with the best description of its purpose. Terms Budgeted income statement Participatory budgeting Definitions 1 A report that shows predicted revenues and expenses for a budgeting period 2. Employees affected by a budget help in preparing it 3. Planning future business actions and expressing them as formal plans 4 A comprehensive business plan that includes operating, investing, and financing budgets 5. Summarizes the effects of investing activities on cash 6 Shows expected cash inflows and outflows and helps determine financing needs 7 An approach that requires all expenses to be justified for each new budget 8 A formal statement of future plans, usually expressed in monetary terms Master budget Cash budget