A Company That Uses Activity-Based Budgeting Performs the Following

question 69

Multiple Choice

A company that uses activity-based budgeting performs the following:
1-Plans activities for the budget period.
2-Forecasts the demand for products and services as well as the customers to be served.
3-Budgets the resources necessary to carry out activities.
Which of the following denotes the proper order of the preceding activities?

• A) 1-2-3.
• B) 2-1-3.
• C) 2-3-1.
• D) 3-1-2.
• E) 3-2-1.

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Definitions:

Common Stock

A type of equity security that represents ownership in a corporation, giving holders voting rights and a share in profits through dividends.

Par Value

The nominal or face value of a bond, share of stock, or coupon as stated by the issuer.

Issued

Refers to the number of shares that a corporation has legally sold to investors and are currently outstanding.

Paid-In Capital

The total amount of cash and other assets that shareholders have given a company in exchange for stock.