ECONOMICS
BUDGETING
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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estimate expenses and savings
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create a budget worksheet
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enter most expenses as “miscellaneous”
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estimate income
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Detailed explanation-1: -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. So Option C is the right answer.
Detailed explanation-2: -Explanation for correct answer: Preventing net operating loss is not a part of budgeting as the budget is prepared towards finding realizable goals.
Detailed explanation-3: -Budgeting for the national government involves four (4) distinct processes or phases : budget preparation, budget authorization, budget execution and accountability. While distinctly separate, these processes overlap in the implementation during a budget year.
Detailed explanation-4: -It includes fixed cost, variable cost, capital costs, and non-operating expenses.