Sample Questions - Budgeting
1. What is a budget?
2. What is the purpose of having a budget?
3. Explain what could happen if a budget of a given department is over-budgeted?
4. Explain what could happen if a budget of a given department is under-budgeted?
5. What is the first major component of a master budget?
6. What are the two main sections of a master budget?
7. Provide some of the budgets that are contained in;
a. Operating budgets
b. Financial budgets
8. Explain the difference between flexible budgets and static budgets?
9. Discuss the difference between a budgeted balance sheet and the balance sheet prepared at the end of a period? Are the amounts of the two balance sheets same or not and why?
10. Explain the ethical implications of padding the budget?