Which of the Following Trends Is Most Likely to Be

question 30

Multiple Choice

Which of the following trends is most likely to be a signal of impending fiscal stress?

• A) An increasing ratio of own source revenues to total revenues.
• B) A decreasing ratio of total revenues to total expenditures.
• C) A decreasing ratio of debt service expenditures to operating revenues.
• D) A decreasing ratio of operating expenditures to total revenues.

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Definitions:

Budgeting

The process of creating a plan to spend your money, outlining projected income versus expenses over a particular period.

Manufacturing Overhead Budget

A detailed plan showing the production costs, other than direct materials and direct labor, that will be incurred over a specified time period.

Direct Materials

Raw materials that can be directly traced to the manufacturing process of a product and are an integral part of the finished good.

Direct Labor

The cost of workers who can be easily identified with the manufacturing process of a product.