W. 5 TA3 Budgets

What is one main benefit of a business budget?

• Increasing taxes

• Hiring new employees

• Restricting spending

What do budgets ensure about capital?

• It is always increased yearly

• It is not wasted on unnecessary items

• It is used for marketing only

What can saved money be used for?

• Buying new office supplies

• Paying employee bonuses

• Funding future growth

What was a traditional use of budgets?

• Reducing employee workloads

• Managing stock levels

• Forecasting future business activity

Who traditionally prepared budgets in businesses?

• Owners or senior managers

• Marketing teams

• Junior staff

Why were traditional budgets often inaccurate?

• They relied on external consultants

• Managers had limited financial knowledge

• They used outdated software

What type of budgets are being used to handle sales fluctuations?

• Fixed budgets

• Static budgets

• Flexible budgets

What is the benefit of flexible budgets?

• They replace senior managers

• They reduce production

• They show the margin of safety

What do management accountants use budgets for?

• Strategic planning

• Advertising campaigns

• Filing taxes

What problem can arise from inaccurate budgets?

• Reduced taxes

• Increased hiring

• Planning difficulties