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Hello Sir,
I took a test on this chapter and there was a question :
As one step in budgeting process of a business , a company has prepared a production budget detailing the no. of the budgeted on being produced each month.
What is the name of budget ?
I dont understand how is it functional budget ?Also, there was one more question stating that what is not the aim of budgeting process ?
So isnt forecasting one of the main process as we forecast the future cost and revenue while preparing the budget ?The name of the budget is the production budget. It is a functional budget because it is a budget for a specific function.
Forecasting is needed when budgeting, but it is not the aim (or a reason) for producing a budget.
It seems that you are not watching the free lectures on budgeting, because both of these questions are dealt with in the lectures.
Actually I had watched it but it was a long time ago and that day I attempted the PM Questions and came across these…
Thank you so much for explaining it again.
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