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139B458B39 Flashcards | StudBud
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139B458B39
139B458B39
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Questions
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Answers
1
Which is not a direct purpose of budgeting?
Cost cutting
Planning
Effective allocation of resources
Setting targets to be achieved
2
If budgeted costs are less than the budgeted figure, there is a positive variance in the budget
True
False
3
Which of the statements best describes an organisation’s budget?
The money available within a firm to spend
The financial plan for the following year
Departmental monetary allowances
A detailed financial plan for the future
4
Limitations of budgets do not include
Focused on the short-term
Result in unnecessary spending
Setting budgets for new projects
Costs associated with the new accounting team
5
Equipment costs were budgeted at $30 000 and the actual outcome of these costs were $26 000
Negative variance
Adverse variance
Favourable variance
Positive variance
6
Which is not a direct purpose of budgeting?
Setting targets to be achieved
Determining management bonuses
Management planning and coordination
Effective allocation of resources
7
Promotional costs were budgeted at $9000 and the actual outcome of these costs were $11000
Favourable variance
Adverse variance
Positive variance
Negative variance
8
The best example from the following list of a
cost centre
is
Each department of a department store
Each branch in a chain of shops
Each product in the portfolio of a multi-product firm
The restaurant in a hotel
9
Which of the following is not a reason for producing a budget?
Coordination
Coercion
Motivation
Planning and guidance
10
Variance analysis investigates differences between actual and budgeted figures
True
False
11
The master budget is usually prepared before subsidiary budgets
False
True
12
E-commerce sales were budgeted at $25 000 and the actual outcome these sales were $32 000
Positive variance
Adverse variance
Favourable variance
Negative variance
13
Staffing costs were budgeted at $125 000 and the actual outcome of these costs were $115 000
Negative variance
Positive variance
Favourable variance
Adverse variance
14
When staff wages and production costs are lower than the budgeted figure, there is (are)
Increased revenue
Favourable variances
Increased liquidity
Increased profitability
15
The difference between actual results and budgeted results is known as
Discordance
Deviation
Variance
Discrepancy
