Question 1

A budget is a detailed financial plan that quantifies future expectations and actions relative to acquiring and using resources.

True

False

Question 2

Budgets should not be used to provide managers with "preapproval" for the execution of spending plans.

True

False

Question 3

A flexible budget is not designed to change with changes in activity level.

True

False

Question 4

The production budget comes before the materials purchases budget

True

False

Question 5

The starting point for the master budget is an assessment of anticipated production next year.

True

False

Question 6

With zero-based budgeting, each expenditure item must be justified for the new budget period.

True

False

Question 7

A deliberate effort to create "breathing room" within a budget is known as "padding the budget"

True

False

Question 8

Some entities will follow a top-down participative approach to budgeting.

Group of answer choices

True

False

Question 9

"Responsibility accounting" is a concept under which managers are held accountable for transactions and events beyond their direct influence and control.

True

False

Question 10

The master budget is a comprehensive document specifying sales targets, production activities, and financing actions.

True

False