COST ACCOUNTING
INTRODUCTION TO COST ACCOUNTING
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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support for the management functions of planning and coordination
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a means to communicate the organization’s short-term goals to its members
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an ethical framework for decision making
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a means to anticipate problems
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Detailed explanation-1: -A budget is just an estimation. Thus, it does not provide any ethical framework which would help in decision making.
Detailed explanation-2: -The Four Main Types of Budgets and Budgeting Methods. There are four common types of budgets that companies use: (1) incremental, (2) activity-based, (3) value proposition, and (4) zero-based.
Detailed explanation-3: -The correct answer is option D. Preventing net operating losses is not a part of budgeting.
Detailed explanation-4: -Financial budget It factors in assets, liabilities, and stakeholder’s equity-the important components of a balance sheet, which give you an overall idea of your business health.
Detailed explanation-5: -Budget assists management to take decisions as to how to produce, where to produce, the quantity or units of the products that should be produced in a day, a week, or in a month. More also, budget helps in taking decisions on who is to do what.