True / False Questions
90.Pro forma financial statements are financial statements that are prepared based on budgeted future amounts.
True False
91.The capital budget does not affect any of a company's operating budgets.
True False
92.The responsibility for the coordination of a company's budgeting activities normally rests with the CFO.
True False
93.The nature of planning changes with the length of the time period being considered. Generally, the shorter the time period, the more general the plans.
True False
94.Strategic planning deals with the establishment of a long term company objectives.
True False
95.Under continuous budgeting a new month is added to the end of the budget period each time the present month expires so that a twelve-month budget is available at all times.
True False
96.Four purposes or advantages for budgeting involve planning, coordination, performance measurement, and punative action.
True False
97.Janice was questioned recently about her department's spending in excess of the budget. This is an example of using the budget for performance measurement.
True False
98.The three major components of the master budget are the financial budgets, the capital budgets, and the pro forma financial statements.
True False
99.The master budget generally starts with a sales forecast.
True False