➡️QUESTION⬅️
What are the disadvantages of budgetary control systems?
1 Budget holders can be blamed for uncontrollable adverse outcomes.
2 Only financial outcomes are measured and considered.
3 Rigid decision-making often occurs.
A 1,2 and3
B 1and2only
C 1and3only
D 2and3
ANSWER A
➡️QUESTION⬅️
Which statement is not a reason why a business prepares budgets?
A to ensure coordination of the business activities
B to identify potential problems in the future
C to identify the responsibilities of managers
D to prepare the financial statements for the year
ANSWER D
➡️QUESTION⬅️
Who are internal users of accounting information?
A customers
B directors
C lenders
D shareholders
ANSWER B
➡️QUESTION⬅️
A company has recently introduced a system of budgetary control.
Workers have given the following reasons for materials costs being more than budgeted.
1 Budgeted material costs are incorrect.
2 Production machinery is outdated and wastes materials.
3 The company should purchase better quality materials to reduce wastage.
Which reasons will cause actual material costs to be different from the budgeted costs?
A 1,2and3
B 1and2only
C 1and3only
D 2and3only
ANSWER A
➡️QUESTION⬅️
Why do businesses prepare budgets?
1. to communicate plans
2 to improve coordination
3. to plan annual operations
4 to plan long-term strategies
A 1,2 and3
B 1,2and4
C 1,3and4
D 2,3and4
ANSWER A
➡️QUESTION⬅️
Why might a business prepare a budget?
A to determine the amount of bank loan it needs
B to determine the skills of labour force
C to identify its market share
D to identify the quality of its products
ANSWER A
➡️QUESTION⬅️
Why do businesses prepare budgets?
1 to communicate plans
2 to control activities
3. to improve co-ordination
4 to prepare their annual financial statements
A 1,2and3
B 1,2and4
C 1,3and4
D 2,3and4
ANSWER A
➡️QUESTION⬅️
Why is planning important to a business?
1 to ensure that the business always makes a profit
2 toemploy the correct number of workers
3 toreduce the risk of running out of inventory
A 1and2
B 1only
C 2and3
D 3only
ANSWER C
➡️QUESTION⬅️
Which statement identifies an advantage to a business of financial planning?
A Not all managers are aware of business financial planning.
B Specialist knowledge is required to prepare the financial plans.
C The financial plans provide targets for managers to achieve.
D Time and cost is required to prepare the financial plans.
ANSWER C