Exam 15: Budgeting and Controlling Operations and Taxes

Working capital indicates:

Planning is the process of assuring that organizational goals are achieved.

Most small companies like to keep a large amount of long-term debt because the risk is considerably low.

Which of the following is an example of a tax or fee paid to operate a business?

If a firm is making profits, it is impossible for that firm to fail financially.

Tax paid to the taxing authority by the person or business against which it is levied is known as _____.

A negative cash balance requires an increase in payments and decrease in cash receipts.

When a system of budgets is used for planning and control purposes, it becomes budgetary control.

What is credit management? What is its objective?

Explain the budgetary control process. How are audits used to control the budget of a company? What are the benefits of auditing?

The objective of the operating budget is to plan and control revenue and expenses to obtain desired profits.

Use taxes are usually imposed on the use, consumption, or storage of goods within a taxing jurisdiction.

A(n) _____ is a tax added to the gross amount of the sale for goods sold within the taxing jurisdiction.

What are the steps involved in the control process?

A capital budget reflects a business's plans for obtaining, replacing, and expanding physical facilities.

Why is a system of controls necessary in small businesses?

Which of the following budgets is planned first?

A person's liability for sales taxes is always limited to the state to which he/she belongs.

A cash flow budget is a forecast of expected cash receipts and expected cash payments.

A(n) _____ budget plans expenditures for obtaining, expanding, and replacing physical facilities.