Chapter 8, Problem 2E

Using Terms to Complete Sentences about Budgets
Use the following terms to complete the sentences that follow .Terms may be used once, more than once, or not at all:

1. The______ is a set of interrelated budgets that constitutes a plan of action for a specific period.
2. The______ establish goals for the company’s sales and production personnel.
3. A(n) ______ approach to budgeting is more likely to motivate people to work toward an organization’s goal than a(n) ______approach.
4. Managers who intentionally understate expected sales or overstate expected expenses are creating______.
5. Comparing actual results to budgeted plans is an example of management performing its______ function.
6. The starting point for preparing the master budget is the______.
7. The______ provides information about a company’s expected revenue, expenses, and profitability for a period of time.
8. Using a(n) ______, when one budget period passes, another is automatically added at the end.
9. The______ provides information about a company’s expected financial position at a specific point in time.
10. Once the______ has been prepared, the raw materials purchases, the direct Labor, and the manufacturing overhead budgets can be prepared.