Question

1. There is no need for managers to have employees participate in developing the budget because the budget is a management tool.

True

False

2. An intentional understatement of expected revenues or overstatement of expected expenses by managers in order to have a favorable performance evaluation is known as​ ________.

A.

appropriation

B.

variance analysis

C.

benchmarking

D.

budgetary slack

3. The cash budget and the budgeted financial statements are collectively known as the​ ________.

A.

master budget

B.

financial budget

C.

operating budget

D.

production budget

Answer 1

1

False, managers must have employees participate in developing the budget.

In developing budgets, inputs from all levels should be taken so that employees feel the budgets are realistic and achievable.

2

An intentional understatement of expected revenues or overstatement of expected expenses by managers is called budgetary slack

Option D budgetary slack is correct

3

The cash budget and the budgeted financial statements are collectively known as the​ financial budget.

Option B financial budget is correct