Question 24: Which of the following is a purpose or advantage of the master budget process:

a) Coordination of the activities of the different functional areas of the firm.

b) Communication to manage is of how their effort adds value to the organisations products of services.

c) Forces management to establish profit objectives.

d) Provides a tool for evaluation and control.

e) All of these.

Question 25: The two main parts of a master budget are:

a) The sales budget and the income statement.

b) The income statement and the cash budget.

c) The production budget and the selling and administrative budget.

d) The operating budget and the financial budget.

e) None of these.

Question 26: Conceptually, based budgeting means that the managers must:

a) Justify 100% of his or her budget.

b) Justify 80% of his or her budget.

c) Justify 50% of his or her budget.

d) Justify 20% of his or her budget.

e) Justify 10% of his or her budget.

Question 27: A type of budgeting that has been recommended to reduce behavioural conflicts is the:

a) Rolling budget

b) priority budget.

c) Optimistic or reach budget.

d) Flexible budget.

e) Participative budget

Question 28: Which of the following types of budgets provide the weakest form of cost control?

a) Priority incremental

b) Flexible

c) Master

d) Zero-based

e) Incremental

Question 29: The journal entry is:

a) An easy way to visualise business transactions

b) Just like a logbook that contains a chronological listing of accompanies transactions and events.

c) A way to document business activities as it occurs.

d) All of the above.

Question 30: who do the following budgets is used in preparing the budgeted income statement except the:

a) Sales budget.

b) Selling an administrative budget.

c) Capital expenditure budget.

d) Direct labour budget.

Question 31: The Profit and loss statement:

a) Measures the financial performance of an organisation.

b) States the financial position of an organisation.

c) Shows the cash flow in an organisation.

d) Only shows the revenue of the organisation

Question 32: A debit is an accounting entry that either increases a liability or equally account or decreases an asset or expense account.

a) True.

b) False.

Question 33: The records that are kept for the individual asset, liability, equity, revenue, expense, and dividend components are known as accounts:

a) True

b) False

Question 34: A credit is an accounting entry that either increases an asset or expense account or decrease a liability or equity account:

a) True

b) False

Question 35: Under the double-entry system every business transaction is recorded in at least two accounts:

a) True.

b) False.

Question 36: Most operating and capital expenditure budgets cover a period of one fiscal year:

a) True.

b) False.