Principles of Accounting Volume 2
19th Edition
ISBN: 9781947172609
Author: OpenStax
Publisher: OpenStax College
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
Transcribed Image Text: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
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- Briefly describe the type of human behavior problems that might arise if budget goals are set too tightly.arrow_forwardTrue or False 1. Budgets should not be used to motivate and reward employees. 2. Budgets play an important communication role within organizations. They provide a mechanism for managers to share expectations and priorities for the future. 3. Budgets also provide useful benchmarks for evaluating and rewarding employee performance.arrow_forwardA benefit from budgeting is that it forces managers to think about and plan for the future. True or False True Falsearrow_forward
- Vikramarrow_forwardWhich 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.arrow_forwardIncremental budgets encourage managers to over-estimate output to increase their budgets. True Falsearrow_forward
- 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 laborsarrow_forwardWhich 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 truearrow_forwardNonearrow_forward
- 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.arrow_forwardWhich problem might be a result of an unrealistic budget? reduced employee morale profitable operations minimal differences between actual and budgeted amounts favourable operating activityarrow_forwardWhat factors can contribute to unsuccessful budgeting? How can these situations be avoided?arrow_forward
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