Question

. Budgets are used for two distinct purposes – planning and control.

True False

Answer 1

This statement is True

Budget are used to plan the future events of the organisation i.e. expected sales, production to be done, expansion needs etc. This will help to seamless transaction of the entity. Planned activities can be done more effectively.

at the same time budget helps to control the costs & other expenditure. Managers will be able to control cost of various activities like labor, production cost, material purchases cost etc. budget helps to effective control so that variance can be identified & corrected in future.

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