Consider the Following Statements About Performance Reports

question 14

Multiple Choice

Consider the following statements about performance reports:
I. Performance reports provide feedback to managers and allow them to better control operations.
II. Many performance reports have budget, actual, and variance data.
III. Performance reports are often structured around a firm's organizational hierarchy-that is, data relating to lower-level units (e.g., departments) are combined and flow into higher-level units (e.g., stores) .
Which of the above statements is (are) true?

• A) I only.
• B) I and II.
• C) I and III.
• D) II and III.
• E) I, II, and III.

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Definitions:

Budgeted Financial Statements

Financial statements projected for a future period, based on estimates of revenues, expenses, and other financial activities.

Operating Budgets

Detailed projections of income and expenses associated with the day-to-day operations of a business over a certain period.

Budgeted Balance Sheet

A projection of a company’s financial position at a future date, including assets, liabilities, and equity, based on expected financial activities.

Sales Budget

An estimate of the expected sales revenue and the allocation of resources needed to achieve these sales over a specific period.