Which of the following is true of a continuous budget?
A) It forces managers to plan ahead constantly.
B) It is broken down into quarterly and monthly budgets.
C) It rules out the comparison of actual data with budgeted data.
D) It is a quarterly budget used only by manufacturing firms.
E) It is a moving 6-month budget.

Question

Quizplus · Accepted Answer

A continuous budget is a budgeting technique that continuously updates and extends a company's budget as the year progresses. It forces managers to plan ahead constantly and adjust their budgets based on changes in the business environment. It is not broken down into quarterly or monthly budgets, but rather is updated on an ongoing basis. It allows for comparisons of actual data with budgeted data, which is an important aspect of budgeting. It is not limited to manufacturing firms, but can be used by any type of business. It is not restricted to a specific time frame, such as a 6-month period.

Which of the Following Is True of a Continuous Budget