WorksheetsFlash Card Quiz: Budgets & Cash Flow
Total questions: 25
Worksheet time: 13mins
What is the first step in constructing a budget?
Analyzing past budgets
Setting financial goals
Estimating income and expenses
Reviewing financial statements
Which of the following is not an example of a budget?
Income
Profit
Asset
Expenditure
What is variance analysis used for in budgeting?
To predict future sales
To compare actual performance with budgeted performance
To allocate resources
To determine tax liabilities
What is an adverse variance?
When actual income is higher than budgeted
When actual expenses are lower than budgeted
When actual performance is worse than budgeted
When budgeted performance is met
What is a favorable variance?
When actual performance is worse than budgeted
When actual income is lower than budgeted
When actual expenses are higher than budgeted
When actual performance is better than budgeted
What is the value of budgeting?
It helps in tax calculation
It provides a financial roadmap
It increases expenses
It reduces income
What is the purpose of a cash flow forecast?
To determine profit margins
To predict future cash inflows and outflows
To calculate tax liabilities
To assess asset value
What does net cash flow represent?
Total income minus total expenses
Total assets minus total liabilities
Total cash inflows minus total cash outflows
Total profit minus total loss
What are opening and closing balances in a cash flow forecast?
The initial and final amounts of cash available
The total income and expenses
The total assets and liabilities
The profit and loss figures
What is the first step in analyzing a budget?
Reviewing financial statements
Comparing actual and budgeted figures
Setting new financial goals
Calculating net profit
Imagine Olivia, a manager at a manufacturing company, is reviewing the monthly financial reports. What is the purpose of variance analysis in this scenario?
To provide insights into deviations between expected and actual performance
To calculate employee payroll
To assess market competition
To forecast future financial conditions
Which of the following is NOT a benefit of budgeting?
Budgets help calculate actual profit?
Budgets help coordination between departments
Budgets help management to control spending
Budgets help with planning
In variance analysis, what is considered a significant variance?
Variances that warrant further investigation due to their impact on the business
Only favorable variances
Variances that are within 5% of the budgeted amount
Any difference between actual and budgeted results
In a given cash flow forecast, the closing balance in June would become the ____________ of July.
Closing balance
Working capital
Net cash flow
Opening balance
Which of the following reduces a businesses cash flow?
Asking debtors for payment
Repaying an overdraft
Securing better trade credit terms from suppliers
selling an asset would be an example of
cash inflow
cash outflow
