1. Why are budgets useful in the planning activity of an organization?
a. Budgets help communicate goals and provide a basis for evaluation.
b. Budgets provide management with information about the company’s past performance.
c. Budgets enable the budget committee to earn paycheck.
d. Budgets guarantee the company to be profitable if it meets the objectives.
2.Which of the following is not a motive for budgeting according to Bible’s teaching?
a. Buy the things I want
b. Stay out of debt
c. Buy the things I need
d. Have enough to give
3. What is the formula for computing production budget?
a. Expected Sales in Units + Planned Ending Inventory Units –
Beginning Inventory in Units
b. Expected Sales in Units + Beginning Inventory in Units + Planned Ending Inventory Units
c. Planned Ending Inventory Units + Beginning Inventory in Units –
Expected Sales in Units
d. None of the above