TRUE OR FALSE

1. A benefit of budgeting is that it provides definite objectives for evaluating performance.
2. A budget can be a means of communicating a company's objectives to external parties.
3. The budget itself and the administration of the budget are the responsibility of the accounting department.
4. The flow of input data for budgeting should be from the highest levels of responsibility to the lowest.
5. Budgets can have a positive or negative effect on human behavior depending on the manner in which the budget is developed and administered.
6. The budget is developed within the framework of a sales forecast.
7. The master budget reflects management's long-term plans encompassing five years or more.
8. The direct materials budget must be completed before the production budget because the quantity of materials available for production must be known.
9. A manufacturing overhead budget is not needed if the company develops a predetermined overhead rate to apply overhead.
10. If a monthly cash budget is prepared properly, there will never be a cash deficiency at the end of any month.
11. Financial budgets must be completed before the operating budgets can be prepared.
12. The starting point when budgeting for a not-for-profit organization is generally to budget expenditures first.