Continuous Budgeting Is the Practice of Preparing a New Budget

question 144

True/False

Continuous budgeting is the practice of preparing a new budget for a selected number of future periods and revising those budgets as each period is completed.

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Definitions:

Opening Inventory

The value of a company's inventory at the beginning of an accounting period, which is carried over from the end of the previous period.

Tax Effect

The impact of tax laws and regulations on an individual's or company's financial decisions and situations, including the calculation of tax liabilities.

Carrying Amount

The value at which an asset is recognized in the balance sheet after accounting for depreciation, amortization, and impairment losses.

Periodic Method

An accounting method where inventory and cost of goods sold (COGS) are determined at the end of an accounting period, as opposed to continuously tracking these figures.