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CMA Inter Budgets and Budgetary Control — practice questions

Explore 11 free Budgets and Budgetary Control questions in CMA Inter Cost and Management Accounting. Open each question or exercise to read its content, reference answers and available explanation.

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Budgets and Budgetary Control questions and exercises with answers

Showing questions 1–11 of 11.

Fixed budget or flexible budget?Read the answer and worked solution →Match the budget to its jobRead the answer and worked solution →Tap the one that does not fitRead the answer and worked solution →A budget prepared for a single, standard level of activity is aRead the answer and worked solution →A flexible budget is more useful for control because itRead the answer and worked solution →A forecast of the output planned for the budget period is theRead the answer and worked solution →The budget that consolidates all functional budgets into a single statement is theRead the answer and worked solution →Zero based budgeting differs from traditional budgeting because itRead the answer and worked solution →A cash budget is primarily concerned withRead the answer and worked solution →Under a fixed budget, comparing actual cost at a different activity level is misleading becauseRead the answer and worked solution →Budgetary control compares actual results againstRead the answer and worked solution →

Worked practice questions

Fixed budget or flexible budget?

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Left
Fixed
Items
  1. Item
    One activity level
    Answer
    Fixed
  2. Item
    Not recast later
    Answer
    Fixed
  3. Item
    Many activity levels
    Answer
    Flexible
  4. Item
    Recast for actuals
    Answer
    Flexible
  5. Item
    Cost split by type
    Answer
    Flexible
Right
Flexible
Instructions
Swipe left for the fixed budget, right for the flexible budget.
_Source: ICAI CA Inter Cost and Management Accounting, Ch15 'Budgets and Budgetary Control', 15.5_

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Match the budget to its job

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Matching pairs
  1. Left
    Production budget
    Right
    Output planned for the period
  2. Left
    Cash budget
    Right
    Receipts and payments timing
  3. Left
    Master budget
    Right
    All functional budgets consolidated
  4. Left
    Zero-based budget
    Right
    Every rupee justified afresh
Instructions
Tap a budget on the left, then what it forecasts.
_Source: ICAI CA Inter Cost and Management Accounting, Ch15, budget classification chart_

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Tap the one that does not fit

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Questions
  1. Items
    1. Production budget
    2. Cash budget
    3. Master budget
    Odd item
    Master budget
  2. Items
    1. Material price variance
    2. Fixed budget
    3. Flexible budget
    Odd item
    Material price variance
  3. Items
    1. Direct material
    2. Office rent
    3. Direct labour
    Odd item
    Office rent
Instructions
Three belong together. Tap the odd one out.
_Source: ICAI CA Inter Cost and Management Accounting, Ch15, 15.5 fixed versus flexible_

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