Chapter 8 vocab and concepts

Question 1

planning and control cycle?

Answer 1

interrelated process of the distinct functions of management.

Question 2

operating budget?

Answer 2

cover the organizations planned operating activities for a particular period of time, including expected sales, production, raw materials, purchases, direct labor, and administrative expenses

Question 3

budgeted income statement

Answer 3

represents managements expectation of net operating income

Question 4

master budget?

Answer 4

is a comprehensive set of budgets that covers all phases of an organization’s planned activities for a specific period of time.

Question 5

financial budget

Answer 5

focus on the financial resources needed to support an organization operations

Question 6

variable manufacturing overhead

Answer 6

other costs of a business that stream from non-direct income flow

Question 7

budgeted balance sheet

Answer 7

A pro-formula sheet that expands the companies expenses and budget on display

Question 8

benefit of budgeting? (3 things)

Answer 8

• Thinking ahead: forces manegers to look forward and state their goals for the future.
• Communication: Communicating management expectations and priorties and promoting cooperation and coordination between functional areas of the organization
• Motivation- Providing the push for employees to work towards organizational objectives and thus providing a benchmark for evaluating performance

Question 9

what words are all used interchangeably to reflect the future oriented nature of the budgeting process?

Answer 9

budgeted, predicted, estimated, forecasted, anticipated, expected and planned