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Question
__________ is a summary of all function budgets in a capsule form.
__________ is a summary of all function budgets in a capsule form.
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Solution
The correct option is C Master budget
Master budget is the sum of all the functional budgets. Functional budgets are prepared for each function and thereafter a master budget is prepared.
A sales budget is an outline of sales expectations set by management, usually for a period of one year. The features of a sales budget usually include a breakdown of sales for each quarter and the number of units to be sold.
A performance budget is one that reflects both the input of resources and the output of services for each unit of an organization.
A cash budget is an estimation of the cash flows for a business over a specific period of time. This budget is used to assess whether the entity has sufficient cash to operate.
Master budget is the sum of all the functional budgets. Functional budgets are prepared for each function and thereafter a master budget is prepared.
A sales budget is an outline of sales expectations set by management, usually for a period of one year. The features of a sales budget usually include a breakdown of sales for each quarter and the number of units to be sold.
A performance budget is one that reflects both the input of resources and the output of services for each unit of an organization.
A cash budget is an estimation of the cash flows for a business over a specific period of time. This budget is used to assess whether the entity has sufficient cash to operate.
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