Variances That Are Large in Absolute Dollar Value or as a Percent

question 87

True/False

Variances that are large in absolute dollar value or as a percent of budgeted amounts are generally considered exceptional in a management by exception approach.

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Definitions:

Budget Surpluses

Occurs when a government's revenues exceed its expenditures during a fiscal period, leading to extra funds.

Budget Deficits

A financial situation where expenditures exceed revenue.

Federal Budget

An annual financial statement presenting the government's proposed revenues and spending for a fiscal year.

Crowds Out

Refers to the effect where increased government spending and borrowing reduce private investment in the markets.