Which of the following is true of budgeting?
A) Budgeting forces management to plan for the future.
B) Budgeting creates a plan of action only in terms of production units.
C) Budgeting eradicates the need for keeping a buffer against uncertainties in demand.
D) Budgeting relies on the control cycle to design the planning cycle for future action.
E) Budgeting focuses only on long-term objectives as covered by the planning cycle.

Question

Quizplus · Accepted Answer

Budgeting is a tool used by management to plan and control financial resources. It forces management to plan for the future by setting goals and objectives, estimating future revenues and expenses, and determining the resources needed to achieve those goals. It helps to ensure that resources are allocated efficiently and effectively.

Which of the Following Is True of Budgeting