CIMA Exam CIMAPRO19-P01-1 Topic 8 Question 13 Discussion

Actual exam question for CIMA's CIMAPRO19-P01-1 exam

Question #: 13
Topic #: 8

Explain THREE benefits that organizations gain from using budgetary planning and control systems.

Select ALL the true statements.

AThe budget acts as a variable mechanism, with actual results being compared with budget.

BBudgeting forces an organization's management to look ahead and set performance targets.

CThe budget provides an external benchmark against which performance against which performance can be evaluated.

DThe budget ensures actions of different parts of the organization are coordinated are reconciled otherwise managers take actions for the benefit of their own part of organization that may not benefit the organization as a whole.

EAnother benefit of budgeting is to set targets to motivate managers and optimize their performance.

FThe budget is a useful device of influencing an operator's thoughts and motivating operators to perform in line with the organization's marketing budget.

GIt provides a standard which managers may be motivated to achieve. It can also encourage inefficiency and conflict between managers particularly if the budget is imposed from above, whereby it may act as a threat rather than as a challenge.

Show Suggested Answer

Suggested Answer: B, D, E, G

References:

by Nobuko at May 08, 2022, 03:17 PM

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