COST ACCOUNTING
FLEXIBLE BUDGETS
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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used to compare actual costs with standards costs
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used to determine the cost of manufactured products
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a detailed plan that translates objectives or goals into financial terms
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A means of product costing that emphasizes activities as basic cost objects
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Detailed explanation-1: -A plan of financial operation embodying an estimate of proposed expenditures for a given period of time or purpose and the proposed means of financing them.
Detailed explanation-2: -The two main objectives of budgeting are as follows: Predicting cash flows. Measuring performance.
Detailed explanation-3: -Not only is budgeting one of the top financial goals people set each new year, but it’s also the foundation you should build all your other money goals on. A budget is how you make progress with your money. It’s a plan for what’s coming in (your income) and what’s going out (your expenses).
Detailed explanation-4: -Answer and Explanation: Option (a) is the correct answer. The last step of a master budget is the budgeted balance sheet, not the budgeted income statement, so it is a wrong statement.