One of the major benefits of formal budgeting is the positive effect it can have

Question

One of the major benefits of formal budgeting is the positive effect it can have on employee applied correctly. True False Budgeting is an informal plan for future business activities. True False The process of evaluating performance can be improved by using budgets. True False Budget preparation is best determined in a top-down managerial approach. True False A rolling budget is a specific budget application relevant only to a merchandising company True False The sequence of the budgets within the master budget are dictated by GAAP. True False

Explanation / Answer

It brings positive affect on the employees since it motivates them to achieve organizational goals

1. True

It brings positive affect on the employees since it motivates them to achieve organizational goals

1. False – it is formal statement of future plans usually expressed in monetary terms

1. True – is a continuous activity of planning , revising and evaluating business

1. False – to be effective it should be determined by management and employees

1. False – it is a continuous budget which does not necessarily means it is relevant for merchandising..

1. False -it is for internal purpose so GAAP is not required

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