ECONOMICS
BUDGETING
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Budgeting allows for raising interest rates
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Budgeting allows for impulse buying
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Budgeting generates a map of financial practices
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Budgeting allows for enhanced debt
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Detailed explanation-1: -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.
Detailed explanation-2: -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-3: -A budget helps create financial stability. By tracking expenses and following a plan, a budget makes it easier to pay bills on time, build an emergency fund, and save for major expenses such as a car or home. Overall, a budget puts a person on stronger financial footing for both the day-to-day and the long term.
Detailed explanation-4: -Answer and Explanation: The answer is b. cash budget. A financial budget is a budget that is related to the company’s balance sheet, which includes the cash budget.