Continuous budgets are constructed by adding a _____.
A)new goal as a current goal is achieved
B)new cost object as a current cost object is eliminated
C)month in the future as the month just ended is dropped
D)year in the future as the current year just ended is dropped

Question

Quizplus · Accepted Answer

Continuous budgets involve dropping the oldest period and adding a new period in the future. This keeps the budget current and allows it to adapt to changes in the business environment. Choice A is incorrect because adding a new goal does not require continuous budgeting. Choice B is incorrect because eliminating a cost object does not require continuous budgeting. Choice D is incorrect because dropping an entire year would be too infrequent for continuous budgeting.

Continuous Budgets Are Constructed by Adding a _____