Which of the Following Statements About Budgeting Is Not True

question 85

Multiple Choice

Which of the following statements about budgeting is not true?

• A) Budgeting is designed to be an aid to planning and control.
• B) Budgets create standards for performance evaluation.
• C) Budgets help coordinate the activities of the entire organization.
• D) Budgeting forces managers to think ahead and to formalize long-range objectives.
• E) Budgeting eliminates the need for day-to-day monitoring of operations.

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Definitions:

Net Income

The total earnings of a company after subtracting all expenses from revenues, also known as net earnings or net profit.

Financial Statements

Documents that provide an overview of a company's financial condition, including the balance sheet, income statement, and cash flow statement.

Retrospective Adjustments

Adjustments made to the financial statements of previous periods to correct errors or to reflect a more accurate representation of the financial position.

Accounting Principle

Fundamental guidelines or rules that govern the accounting process, ensuring that financial statements are fair, consistent, and comprehensive.