All of the Following Are True Statements About the Role

question 26

Multiple Choice

All of the following are true statements about the role of budgets and budgeting EXCEPT that:

• A)a budget is a quantitative summary of the expected allocations and financial consequences of the organization's short-term operating activities.
• B)budgeting includes the process of estimating money inflows and outflows to determine a financial plan that will meet an organization's objectives.
• C)the difference between actual results and the budget plan are called variances.
• D)budgeting solves most business challenges because it coordinates activities and communicates the organization's short-term goals to its members.

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Definitions:

Accounts Receivable

Debts that customers owe a business for delivered goods or services awaiting payment.

Average Collection Period (ACP)

A financial metric that measures the average number of days it takes for a company to collect payments from its credit sales.

Sales Projection

An estimate of the future sales figures of a product or service, based on market research, historical data, and other predictive techniques.

Accounts Receivable

Unsettled payments from clients to a company for goods or services that have been offered but not yet paid for.