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1 | |
One of the following statements is not a benefit of budgeting
(Learning Objective 1 Ch 12) |
| | A) | It helps with communications between members of the organisation |
| | B) | It forces managers to think and plan for the future |
| | C) | It helps with allocating resources to places where they are needed |
| | D) | It means that in all cases budgets are not based on previous ones |
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2 | |
One of the following statements is not a benefit of budgeting
(Learning Objective 1 Ch 12) |
| | A) | Every person in the organisation will understand the prepared budget |
| | B) | Goals and objectives can be set as benchmarks |
| | C) | Coordination between different sections can be improved |
| | D) | Potential bottle necks can be uncovered |
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3 | |
One of the following is not a disadvantage of budgeting
(Learning Objective 1 Ch 12) |
| | A) | Pseudo-participation |
| | B) | Budgeting cannot be used for “not for profit” organisations |
| | C) | A lack of understanding of budgeting by some of the participants |
| | D) | Some accountants regarding the figures in the budgets as their own property |
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4 | |
One of the following is not a feature of responsibility accounting
(Learning Objective 1 Ch 12) |
| | A) | It prevents things “falling between” people |
| | B) | Each line item in the budget is made the responsibility of one of the managers |
| | C) | One of the purposes is to penalise managers for missing targets |
| | D) | The managers should correct any unfavourable variances on their own initiative |
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5 | |
Which one of the following is not a basic premise of responsibility accounting?
(Learning Objective 1 Ch 12) |
| | A) | Budget data can be a basis for evaluating performance |
| | B) | Costs can be organised in levels of management responsibility |
| | C) | Managers are only made responsible for costs under their control |
| | D) | The managers in all cases must participate in the setting of the budget |
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6 | |
One of the following is not cited as a feature of the self imposed budget
(Learning Objective 1 Ch 12) |
| | A) | Participants are more likely to blame others when things go wrong |
| | B) | Participants closer to the activities are likely to know more about the figures |
| | C) | Participants are likely to feel more fulfilled |
| | D) | Participants are likely to feel more valued |
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7 | |
The ideal level of targets for motivational purposes in a budget is
(Learning Objective 1 Ch 12) |
| | A) | Very high |
| | B) | Just within reach |
| | C) | Very Low |
| | D) | None of these |
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8 | |
The first budget in the budgeting process is normally the ………. budget
(Learning Objective 2 Ch 12) |
| | A) | Purchases |
| | B) | Sales |
| | C) | Production |
| | D) | Cash |
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9 | |
Which of the following statements are untrue. All sections of a master budget ……
(Learning Objectives 3-10 Ch 12) |
| | A) | must be prepared separately |
| | B) | depend on the limiting factor if one exists |
| | C) | depend on each other |
| | D) | must be worked out step by step in order |
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10 | |
One of the following statements about Zero Based Budgeting is untrue
(Learning Objective 10 Ch 12) |
| | A) | It has been accused of being too costly |
| | B) | It has been accused of being too time consuming |
| | C) | It involves starting from scratch each time |
| | D) | It is justified in each situation |
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11 | |
One of the following is not a feature of international budgeting
(Learning Objective 10 Ch 12) |
| | A) | There may be problems with currency translation |
| | B) | Hedging helps currency exposure |
| | C) | Head office normally have good knowledge of local conditions |
| | D) | Local problems exist such as hyper inflation |
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