Survey Of Accounting
4th Edition
ISBN: 9780077862374
Author: Edmonds, Thomas P.
Publisher: Mcgraw-hill Education,
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Concept explainers
Question
Chapter 14, Problem 1Q
To determine
Whether the given statement is correct
Expert Solution & Answer
Explanation of Solution
Given statement:
The budgets are beneficial only to the small scale companies as they can estimate the sales with accuracy.
Whether the given statement is correct:
The statement is incorrect as budgets are useful for both the small and large companies. Budgets are the tool of communication where the company communicates its objectives through budgets in a document by formalizing the plans framed by management.
Budgets and these kinds of benefits are applicable to all sizes of the companies which operate at various levels of complexity.
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Students have asked these similar questions
“Budgets meet the cost–benefit test. They force managers to act differently.” Do you agree? Explain.
Q.“Budgets meet the cost–benefit test. They force managers to act differently.” Do you agree? Explain.
Generally speaking, budgets are not used to:
assist in the control of profit and operations.
facilitate communication and coordinate activities.
evaluate performance.
create a plan of action.
identify a company's most profitable products.
Chapter 14 Solutions
Survey Of Accounting
Ch. 14 - Prob. 1QCh. 14 - Prob. 2QCh. 14 - 3.What are the three levels of planning? Explain...Ch. 14 - 4.What is the primary factor that distinguishes...Ch. 14 - 5.What is the advantage of using a perpetual...Ch. 14 - Prob. 6QCh. 14 - Prob. 7QCh. 14 - 8. Ken Shilov, manager of the marketing...Ch. 14 - Prob. 9QCh. 14 - 10.What is the normal starting point in developing...
Ch. 14 - 11. How does the level of inventory affect the...Ch. 14 - 12.What are the components of the cash budget?...Ch. 14 - 13.The primary reason for preparing a cash budget...Ch. 14 - 14.What information does the pro forma income...Ch. 14 - 15.How does the pro forma statement of cash flows...Ch. 14 - Prob. 1ECh. 14 - Prob. 2ECh. 14 - Prob. 3ECh. 14 - Prob. 4ECh. 14 - Prob. 5ECh. 14 - Prob. 6ECh. 14 - Prob. 7ECh. 14 - Prob. 8ECh. 14 - Prob. 9ECh. 14 - Prob. 10ECh. 14 - Prob. 11ECh. 14 - Prob. 12ECh. 14 - Preparing a cash budget
The accountant for Erica’s...Ch. 14 - Prob. 14ECh. 14 - Prob. 15ECh. 14 - Prob. 16PCh. 14 - Prob. 17PCh. 14 - Prob. 18PCh. 14 - Prob. 19PCh. 14 - Prob. 20PCh. 14 - Prob. 21PCh. 14 - Prob. 22PCh. 14 - Prob. 23PCh. 14 - Prob. 1ATCCh. 14 - Prob. 4ATCCh. 14 - Ethical Dilemma Bad budget system or unethical...
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- Various types of budgets facilitate understanding about the big picture of a business. There are budgets that are set and unchangeable, as well as budgets that allow for variability. •What are two different types of budgets? And how do they compliment each other? •What is the difference between a flexible budget?and a static budget? •Which budget works best for a business?arrow_forward2 Which of the following items does not follow from the adoption of a budget? a. Deterrent to waste b. Basis for performance evaluation c Guarantee of accomplishing the profit objective d. Promote efficiencyarrow_forwardPLEASE ANSWER ALL TRUE OR FALSE 2. The most important cost of a modern budgeting system is forced management planning.3. In general, the starting point in preparing a master budget should be to forecast production volume, if the company has a relatively large manufacturing capacity and operates in a highly competitive industry.arrow_forward
- Which among the following is not an element of budgeting? a. Budgeting should state the firm’s expectations clearly b. The targets fixed should be very high in budgeting. c. Good system of accounting is essential. d. The authority and responsibility should be clearly fixed.arrow_forwardHello, for this same problem, what is the sales budget?arrow_forward1.- True or False. Fill in the space with your answer (V) or (F), always justify that you qualify it as false. 1. _-_ A budget is the result of the accounting that the company performs for an accounting period already carried out. 2. -- Through the breakeven point we determine the minimum quantity that a company must sell in order to have a moderate or balanced profit. 3. ___ The Direct Cost approach is the one that presents the cost of sale directly integrating the fixed and variable cost. 4. Sales is an aspect that can be budgeted based on management's goals. 5. -_ The master budget only contemplates the estimation of the most important things for a company, such as its sales.arrow_forward
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