When budgets are used for control,
A)budgeted amounts from different years are compared.
B)actual amounts from different years are compared.
C)budgeted amounts are compared to actual amounts.
D)none of these.

Question

Quizplus · Accepted Answer

When budgets are used for control, the budgeted amounts are compared to actual amounts. This allows for managers to identify any discrepancies between what was planned and what actually occurred, and take corrective action if necessary. Comparing budgeted amounts from different years (choice A) or actual amounts from different years (choice B) would not be as effective in identifying current performance issues. Choice D is not applicable.

When Budgets Are Used for Control