t. A rolling budget is a budget that A) extends 5-10 years into the future. 8) is continuously updated, so that the next 12 months of operations are always budgeted. C) begins with zero for each expense, and then amounts are added in. D) is executed by upper management 2. Participative budgeting is an approach to budgeting that A. is top-down in nature. B. allows top management to set the budget C. discourages budget slack. D. is more likely to motivate people to work towards the organization's goals. 3. Which of the following statements about budgeting is not true? A) Budgeting is an aid to planning and control. B) The operating budget should be prepared by top management, rather than mid-management personnel, because they have the overall objectives of the company in mind. C) Budgets help to coordinate the activities of the entire organization. D) Budgets promote communication and coordination between departments in an organization 4. The budget is a component in a financial budget. A) direct labor B) capital expenditures C) budgeted income statement D) manufacturing overhead 5. Which of the f following is a potential disadvantage of participative budgeting? A) Managers are more likely to be motivated by budgets they help creat. B) Managers may build slack into the budget. C) Managers should acquire knowledge to create realistic budgets D) Managers do not understand production requirements. Which of the following is an advantage of zero-based budgeting? A) Zero-based budgeting requires much time to complete. 6. B) Zero-based budgeting forces managers to justify each dollar in the budget to ensure that some expenses are lower in a current year compared to what they were in previous years C) Zero-based budgeting is labor intensive. D) All of the above are advantages