Question

Which of the following statements about budgeting is false? Multiple Choice Budgets create standards for performance evaluation. Budgeting forces managers to think ahead and formalize future objectives. Budgets help coordinate the activities of the entire organization. The master budget should only be prepared by top management. Budgeting is an aid to planning and control.

Answer 1

Answer:

The master budget should only be prepared by top management.

Explanation:

A budget is an estimation of the amount of money that a person or business plans to spend on activities within a given period.

Budgeting creates efficiency in spending and reduces waste.

It is an activity that should be carried out by all relevant staff. This is because the staff know where they need to spend money.

It top management independently make a budget, it may not meet some pressing needs of the staff.