Which of the following statements concerning budgeting is correct?
A) All budgets must be prepared in dollar values.
B) Performance evaluation and budgeting are not closely related.
C) A budget is an essential step in managing a business efficiently.
D) A budget prepared by an individual is more detailed than one used by a business.

Question

Quizplus · Accepted Answer

A budget is an essential tool for managing a business efficiently as it helps to plan and control expenditures, project revenue, and allocate resources. It provides a framework for decision-making and helps businesses to monitor their financial performance. Option A is incorrect because budgets can be prepared using other currencies. Option B is incorrect because performance evaluation is closely related to budgeting as budgets are used to set targets and assess the achievement of those targets. Option D is incorrect because budgets for businesses are typically more detailed than those prepared by individuals as they involve various departments and cost centers.

Which of the Following Statements Concerning Budgeting Is Correct