Which of the Following Alternatives Reflect the Proper Order of Preparing

question 123

Multiple Choice

Which of the following alternatives reflect the proper order of preparing components of the master budget? 1. Financial budget
2) Operating budget
3) Capital expenditures budget

• A)1, 3, 2
• B)2, 3, 1
• C)1, 2, 3
• D)3, 1, 2

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Definitions:

Combination Leases

Combines some aspects of both operating and financial leases. For example, a financial lease that contains a cancellation clause—normally associated with operating leases—is a combination lease.

Operating Leases

Leasing agreements for assets where the lessor retains ownership, and the lessee uses the asset for a specified period.

Financial Leases

Long-term leases that are non-cancellable and include terms to buy the asset at the end of the lease period.

Equity Options

Financial derivatives that give the holder the right, but not the obligation, to buy or sell a stock at a specified price before a certain date.