Which of the following is an advantage of budgeting?
A)Budgets help managers by eliminating risk,as they show actual values of expected activities.
B)Budgets form a part of the financial statements of a company.
C)Budgets help managers by identifying potential constraints.
D)Budgets contain only dollar values and this helps in analyzing actual performance.

Question

Quizplus · Accepted Answer

Budgets help managers by identifying potential constraints, allowing them to make informed decisions and allocate resources effectively. Budgets do not eliminate risk, as they are based on estimates and assumptions rather than actual values. While budgets often appear in financial statements, this is not a primary advantage of budgeting. Finally, budgets may contain non-financial data and analysis in addition to dollar values.

Which of the Following Is an Advantage of Budgeting