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1. When employees throughout an organisation are meaningfully involved in the bu

ID: 2458969 • Letter: 1

Question

1. When employees throughout an organisation are meaningfully involved in the budget-setting process, this is referred to as: Choose one answer. a. Padding the budget. b. Employee-based budgeting. c. Participative budgeting d. Budgeting slack. e. "Top-down" strategic planning.

2 Sydney Ltd has provided you with the following budget information for June:                                 Cash collections $876,000 June 1 cash balance $23,000 Cash disbursements $978,600 Sydney Ltd has a policy of maintaining a minimum cash balance of $20,000 and borrows only in $1,000 increments. How much money will Sydney Ltd borrow in June? Answer: Unit Number

3. The difference between the revenue or cost projection that a person provides and a realistic estimate of the revenue or cost is called: Choose one answer. a. Participative budgeting. b. Budgetary slack. c. Passing the buck. d. Resource allocation processing. e. Employee-focused budgeting.

4 Mildura Company is planning to purchase non-current assets at a cost of $200,000. The planned delivery date is 1st September 2014. A deposit of $10,000 is to be paid on 1St July 2014. The amount that will appear in the cash budget for July 2014 is: Choose one answer. a. $190,000 outflow. b. $10,000 inflow. c. $10,000 outflow. d. $190,000 inflow. e. $200,000 outflow.

Explanation / Answer

ANSWERE

1 . (C) Participative budgeting

Participative budgeting is a budgeting process under which those people impacted by a budget are actively involved in the budget creation process.

2.

3.

b. Budgetary slack.

Budgetary slack can take one of two forms: It can either underestimate the amount of income or revenue that will come in over a given amount of time, or overestimate the expenses that are to be paid out over the same time period.

4.

c. $10,000 outflow

cash balance $23,000 Cash disbursements $978,600 Cash collections $876,000 borrows only in $1,000 increments NEED TO BORROW $ 58600 (BALANCING FIG.) minimum cash balance of $20,000