Question

1. A master budget________. a) is the initial plan of what the company intends to accomplish in the period and evolves from both the operating and financing decisions.b) is only prepared for manufacturers as they are the only type of company with material purchases and work-in-process accounts. c) improves companies' market capitalization and evolves from both the investing and financing decisions d) is another name given to the financial budget 5 points.2. The operating budget process generally concludes with the preparation of the________. a. production budget.b. cash flow statement.c. balance sheet.d. budgeted income statement.

Answer 1

Answers:

The correct answer is 1. a) is the initial plan of what the company intends to accomplish in the period and evolves from both the operating and financing decisions. 2. d. budgeted income statement.

Explanation:

To begin with, a budget is an estimate of the expected results of a specific area in a given period, mainly one year. For its part, the master budget is a plan that covers all areas of the company, and can be adjusted depending on the situations or events that influence the achievement of results. This tool allows a projection of the expected returns taking into account a previous base and the current situation of the sector in which it is located, which is why it is important because it allows drawing a road map for the benefit of all collaborators.