Which of the Following Statements Regarding Budgets Is True

question 22

Multiple Choice

Which of the following statements regarding budgets is true?

• A)More aggregate budgets are more difficult to plan.
• B)More aggregate budgets have sound usefulness during monitoring of performance due to the abundance of information they provide.
• C)Budgets can be set at two levels.
• D)Budgets can be set for each different type of revenue and expense for each division as contained in the chart of accounts.

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Definitions:

Long-Term Liabilities

Financial obligations of a company that are due beyond one year, including bonds payable, long-term loans, and lease obligations.

Working Capital

The difference between current assets and current liabilities, indicating the short-term financial health of a business.

Working Capital

The difference between a company’s current assets and current liabilities, measuring its ability to pay off short-term obligations.

Current Ratio

The current ratio is a liquidity ratio that measures a company's ability to cover its short-term obligations with its current assets.