ECONOMICS
BUDGETING
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Planning
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Controlling
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Motivating
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Decision making
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Detailed explanation-1: -The correct answer is option D. Preventing net operating losses is not a part of budgeting.
Detailed explanation-2: -Budget has five different functions: Planning; Facilitating communication and coordination across the organisation; Allocation resources; Controlling profit and operations; Evaluating performance and providing incentives.
Detailed explanation-3: -The correct answer is B the cost of goods sold budget. A functional budget is a budget which relates to any of the functions of an undertaking, sales, production, research and development cash, etcetera. As such, the cost of goods sold is not included in the functional budget.
Detailed explanation-4: -Cash inflows and cash outflows are used to calculate the budget. Operating expenses are a part of the total cash outflow. Setup cost is incurred for starting the business and hence is excluded in the budget calculations.
Detailed explanation-5: -It Ensures Resource Availability. At its core, budgeting’s primary function is to ensure an organization has enough resources to meet its goals. It Can Help Set and Report on Internal Goals. It Helps Prioritize Projects. It Can Lead to Financing Opportunities. It Provides a Pivotable Plan. 06-Jul-2022