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chass krenke
on Nov 01, 2024

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Below are various statements about different budgeting techniques.Which is false?

A) Budget ratcheting tightens targets when performance fails to meet the target by a predetermined percentage
B) Budget lapsing prevents managers from hoarding funds
C) Master(static) budgets are prepared for a single level of activity
D) Budget lapsing encourages managers to spend money regardless of cost or value
E) None of the choices are correct

Budget Ratcheting

The practice of setting future budget allocations based on the current period’s expenditures, discouraging under-spending in fear of budget cuts.

Budget Lapsing

A type of budgeting that does not allow managers to carry over budget surpluses from one year into the next year. Under a budget lapsing system, funds not spent are lost at the end of the budget period.

Master Budgets

Comprehensive financial planning documents that include both operational and financial budgets, providing a complete picture of organizational financial activities.

  • Comprehend and implement fundamental concepts of budgeting and forecasting.
  • Distinguish among various budgeting methods and their implementation in both the private and public sectors.
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Javawnna AustinNov 05, 2024
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