Which of the following statements is TRUE of the budgeting process?
A) If a company carefully plans for its future, there will be no need to make modifications during the budget period.
B) It is a continuous process that encourages communication.
C) It shows the actual performance of the business.
D) Managers and employees are motivated to accept the budget's goals because they enjoy having their work monitored and evaluated.

Question

Quizplus · Accepted Answer

The budgeting process is a continuous process that involves ongoing communication and adjustments as needed. It is not a one-time event, but rather a dynamic process that requires ongoing attention and monitoring.

D is not a true statement as not all employees and managers may be motivated by having their work monitored and evaluated. Motivations may vary from person to person.

A and C are not true statements. Budgets are not foolproof and situations can arise which may require modifications during the budget period. Budgets show planned performance, not actual performance.

Which of the Following Statements Is TRUE of the Budgeting