Challenging but highly achievable budgets increase the likelihood that lower-level managers will engage in undesirable behavior to secure their desired compensation. O True O False

Which of the following statements are TRUE? I.   Responsibility accounting attempts to assign blame for problems to a specific manager.II.  One benefit of a budget is that it helps managers gather relevant information for improving future performance.III. Challenging budgets tend to motivate improved performance.IV.  Controllability may be difficult to pinpoint because some costs are the result of the market, not the manager.

Incremental budgets encourage managers to over-estimate output to increase their budgets.   True False

Which of the following is not a benefit of budgeting? O Provide a way to measure business performance Help managers communicate expectations and quickly. spot deviations Keep managers focussed on financial implications of their business decisions O Provide a way to hire specialized labors

Which of the following statements are TRUE? 1. Responsibility accounting attempts to assign blame for problems to a specific manager. 11. One benefit of a budget is that it helps managers gather relevant information for improving future performance. III. Challenging budgets tend to motivate improved performance. IV. Controllability may be difficult to pinpoint because some costs are the result of the market, not the manager. a) I, III, and IV are true. b) I and IV are true c) II, III, and IV aregrue. d) All statements are true

None

Which of the following is not a benefit of participative budgeting?   Multiple Choice It serves as training or development for managers. It provides information that employees know but managers do not. It reduces or eliminates the need for tracking actual cost activity. It enhances employee motivation and acceptance of goals.

Which problem might be a result of an unrealistic budget? reduced employee morale profitable operations minimal differences between actual and budgeted amounts favourable operating activity

What factors can contribute to unsuccessful budgeting? How can these situations be avoided?

Budgeting can be an important management tool if implemented properly. Identify several positive results when budgets are used properly. Since budgets affect people, identify several negative aspects if budgets are not implemented properly. Additionally, please discuss in detail how the budgeting process is essential to managers.