True & False (1 pts) 1) The formula for computing return on investment is controllable margin divided by average operating assets. True False (1pts) 2) Budgets are statements of management's plans stated in financial terms True False (1 pts) 3) A budget can be a means of communicating a company's objectives to external parties True False 4) The budget itself and the administration of the budget are the responsibility of the accounting (1 pts) department True Type here to search 0 9 M e o 68 minutes (1pts) 5) A budget can be used as a basis for evaluating performance. True False (1pts) 6) The master budget reflects management's long-term plans encompassing five years or more. True False 7) A cost center incurs costs and generates revenues and cost center managers are evaluated on (1pts) the profitability of their centers. True False 8) If actual results are different from planned results, the difference must always be investigated (1 pts) by management to achieve effective budgetary control. True False 11 Type here to search o 9 e X 9) The budget committee has the responsibility for coordinating the preparation of the budget. (1pts) True False 10) Budget reports provide the feedback needed by management to see whether actual operations are on course. (1 pts) True False 11) Management by exception means that management will investigate areas where actual results (1pts) differ from planned results if the items are material and controllable. True False 12) A benefit of budgeting is that it provides definite objectives for evaluating performance. (1 pts) True False 1 Type here to search O (1pts) 13) Cost centers, profit centers, and investment centers can all be classified as responsibility centers. True False 14) The master budget consists of operating and financial budgets. (1 pts) True False 15) If a monthly cash budget is prepared properly, there will never be a cash deficiency at the end (1pts) of any month. True False 16) Budget reports comparing actual results with planned objectives should be prepared only once (1 pts) a year. True False * O Type here to search 9 e 17) A master budget is most useful in evaluating a manager's performance in controlling costs. True False 18) The longer the budget period, the more reliable the estimates of future outcomes. (1 pts) True False 19) The master budget is not used in the budgetary control process. (1 pts) True False 20) A static budget is one that is geared to one level of activity (1 pts) True 1 Type here to search 0 9 e @ (1pts) 18) The longer the budget period, the more reliable the estimates of future outcomes. True False (1pts) 19) The master budget is not used in the budgetary control process. True False (1 pts) 20) A static budget is one that is geared to one level of activity True False Next Type here to search o 9 N e
