One statement about budgeting that is generally true is
A)manufacturing companies spend more time on budgets than do service companies.
B)service company budgets tend to change only if there is a major increase or decrease in sales levels from year to year.
C)the budget process is an element of a company's activities and should be used throughout the year to evaluate performance.
D)the budget process is useful to assure shareholders that their interests will be looked after.

Question

Quizplus · Accepted Answer

Budgeting is an ongoing process, not just a one-time event. By evaluating actual results against budgeted expectations throughout the year, a company can take corrective action and make necessary adjustments to achieve its financial goals. Therefore, budgeting should be used throughout the year to evaluate performance. Options A, B, and D are not valid statements about budgeting principles.

One Statement About Budgeting That Is Generally True Is