Question

Which of the following is an example of the planning function of the budgeting process?

A) A budget demands integrated input from different business units and functions.
B) Employees are motivated to achieve the goals set by the budget.
C) Budget figures are used to evaluate the performance of managers.
D) The budget outlines a specific course of action for the coming period.

Answer 1

The budgeting planning function is exemplified by outlining a specific course of action for the upcoming period, demonstrating how resources are allocated to achieve future financial targets and strategic objectives.

Step-by-step explanation:

The example of the planning function of the budgeting process in the question is D) The budget outlines a specific course of action for the coming period. This aspect of budgeting is focused on crafting a blueprint for what the business aims to achieve financially in the foreseeable future. A budget not only provides a detailed forecast of incomes and expenses but also allows an organization to allocate resources effectively and pursue strategic goals. In contrast, options A, B, and C are more related to coordination, motivation, and control functions of the budget, respectively.