This document provides a multiple choice questions (MCQs) on budget and budgetary control. It contains 50 MCQs to help students prepare for exams in commerce subjects like B.Com, MBA, and competitive exams. The MCQs cover topics like types of budgets, steps in budgetary control, classifications of budgets, and concepts like master budget, sales budget, flexible budgets. It also provides explanations for the answers. The document was prepared by Kumar Nirmal Prasad and provides his contact details and website for more budget-related practice questions.

1. MCQs on Budget and
Budgetary Control
Dynamic Tutorials and Services

2. MCQs on budget and budgetary control
are Useful for the following Exams:
1) B.Com and M.Com
2) BBA and MBA
3) CMA, ICAI and ICSI exam
4) Dibrugarh University, Gauhati University,
Mumbai and Pune University
5) M.Com Entrance Exams
6) All Competitive exams for Commerce stream
students

3. Prepared By: Kumar Nirmal Prasad
Address:
Near Jivan Jyoti Hospital, Tinsukia College Road
Tinsukia (Assam – 786125)
Email id:
kumarnirmalprasad@gmail.com
Official website:
https://www.dynamictutorialsandservices.org/
Contact Number:
9577097967

4. 1) Which one of the following is a financial budget?
a) Cash Budget
b) Working Capital Budget
c) Capital budget
d) All of the above
Ans: d) All of the above
2) Which one of the following is not a financial budget?
a) Cash budget
b) Capital budget
c) Budgeted funds flow statement
d) Sales budget
Ans: d) Sales budget

5. 3) Which from the options below is not a step from
budgetary control?
a) Establishing a plan or target of performance
b) Recording of actual performance
c) Comparing the actual with budgeted figures to find out
variances.
d) None of the above
Ans: d) None of the above
4) Long term budgets are prepared for:
a) Capital Expenditure
b) Research and Development
c) Long Term Finances
d) All of the above
Ans: d) All of the above

6. 5) Budgetary control helps in implementation of:
a) Standard Costing
b) Marginal Costing
c) Ratio Analysis
d) Technical Analysis
Ans: a) Standard Costing
6) Budgetary control system facilitates centralized control
with:
a) Decentralized activity
b) Centralized activity
c) Both a) and b)
d) None of the above
Ans: c) Both a) and b)

7. 7) The budgets are classified on the basis of:
a) Capacity
b) Time
c) Functions
d) All of the above
Ans: d) All of the above
8) Which budget is the first step of budgetary system and all
other budgets depends on it?
a) Cash Budget
b) Production Budget
c) Sales Budget
d) Master Budget
Ans: c) Sales Budget

8. Fill in the blanks:
1. A budget is a detailed plan of operations for future periods.
2. A factor which influences all other budgets is called key factor.
3. Forecasting leads to budgeting and budgeting leads to budgetary
control.
4. A budget is an aid to management.
5. The starting point in developing the master budget is the
preparation of the sales budget. A budget is a projected plan of
action expressed in Physical units & monetary terms.

9. State whether the following statements are true or false:
1. Budget relating to key factor should be prepared last. False
2. Budgeting may be said to be the art of building a
budget. True
3. Efficiency ratio determines the capacity used by the
factory. False
4. Calendar ratio calculates the ratio between actual and budgeted
days. True
5. Zero base budgeting will be appropriate in areas where output is
not related to production. True
6. Flexible budgets change with the level of activity. True
7. Budgeting may be said to be an act of determining costing
standards. False

10. For more than 150 MCQS relating to Budget and
Budgetary Control
Visit the following Link
https://www.dynamictutorialsandservices.org/2020/09/m
cq-on-budget-and-budgetary-control.html