Question

True / False Questions: 1. The flow of input data for budgeting should be from the highest levels of responsibility to the lowest True False 2. The master budget reflects management's long-term plans encompassing five years or more True False 3. The starting point when budgeting for a not-for-profit organization is generally to budget expenditures first True False The manufacturing overhead budget generally has separate sections for variable, mixed, and fixed costs True False 5. The budgeted income statement indicates the expected profitability of operations for the next year True False

Answer 1

1) False

As flow should start from lower levels of management.

2) False

Master budget is usually for one year and this is being reviewed monthly and quarterly. Master budget covers all the department and processes of a company, like Sales, Marketing, Production, Purchase etc..

3) True

In budget of nonprofit organization they plan how the organization will be spending.

4) False

Generally manufacturing overhead budget includes fixed and variable costs budget, mixed is not part of it. There are very few exception to this where mixed is taken into consideration.

5) True

Budge Income Statement is like income statement so yes it helps in knowing expected profits and also continuous planning to meet that.

Thanks