Which of the Following Is the Best Reason for Preparing

Multiple Choice

Which of the following is the best reason for preparing budgets for governmental entities on the cash basis?

A) Cash basis budgeting helps to achieve interperiod equity.
B) Cash basis budgeting helps to ensure that the government will receive no more in revenues than it is required to disburse.
C) Cash basis budgeting helps a government plan to have cash on hand to pay bills
D) Cash basis budgeting more accurately reflects the economic impact of fiscal activities.