Which of the following is false with regard to budgetary planning? Question 10 o

Question

Which of the following is false with regard to budgetary planning? Question 10 options: For a service enterprise, the critical factor in budgeting is coordinating professional staff needs with anticipated services. Budgets may be used by manufacturing companies, merchandising companies, service enterprises, and not-for-profit organizations. The starting point for the budgets of a not-for-profit organization is generally receipts, rather than expenditures. A merchandising company uses a purchases budget instead of a production budget.

Explanation / Answer

The following statement is False:

The starting point for the budgets of a not-for-profit organization is generally receipts, rather than expenditures.

In non profit organisation budget is prepared on the basis of cash flow is from expenditure and receipts rather than on a revenue and expenses basis which is followed in profit oriented organization.So the starting point is generally expenditure rather than receipt in not-for-profit organization

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