B4-M5 Budgeting 1 Flashcards
1
Q
what is the order of the 4 types budget must be prepared?
A
sales, production (to support sales), direct material purchases (to support production), cash disbursement
2
Q
what is authoritative standards?
A
standards imposed by management without employee input
3
Q
what is participative standards?
A
standards developed in collaboration with employees involved with the work
4
Q
what is attainable standards?
A
represent per unit budgets that assume normal conditions
5
Q
what is static budget?
A
based on costs at one level of output. include budgeted costs for budgeted output and not based on or adjusted for actual performance
6
Q
what is production budget is based on?
A
It is based on the sales budget (or forecast), with modification for increases or decreases in inventory levels
