Final answer:
The master budget includes more than just the operating and capital budgets; it also consists of a cash flow budget, budgeted balance sheet, and financing plan, making the statement false.
Step-by-step explanation:
The statement that the master budget only includes operating and capital budgets is false. A master budget is a comprehensive financial planning document that includes a number of different components. In addition to the operating budget, which covers the revenue and expense side of operations, and the capital budget, which outlines plans for long-term investments and asset purchases, the master budget also typically includes a cash flow budget, budgeted balance sheet, and financing plan. The cash flow budget is an estimate of the cash inflows and outflows over a certain period, which helps in managing the company's cash position. The budgeted balance sheet forecasts what the business's financial position will look like at the end of the period, and the financing plan details how the business intends to finance its operations and capital investments, including details about debt and equity.