Question

Which of the following statements is correct? A. The standardized budget and the actual budget differ because the latter does not take government transfer payments into account. B. The standardized budget is less likely to show a deficit than is the actual budget. C. The standardized budget and the actual budget will show the same size deficit or surplus in any given fiscal year. D. The standardized budget is more likely to show a deficit than is the actual budget.

Answer 1

B. The standard budget has less chances to show deficit than the deficit in actual budget.

Step-by-step explanation:

Standard Budget is the budget prepared on standard norms, based on standard capacity, generally the company wants to reach this quantum in each respect of targets defined in budget.

Whereas, actual budget is not a budget it is report card of actual performance, therefore, if any deficit has to occur it will occur in actual budget, and not in standard budget.

Therefore correct statement is

B. The standard budget has less chances to show deficit than the deficit in actual budget.