COA COA Financial Management & Budgeting 2

Question 1

Variance analysis in budgeting compares:

Accepted Answer

Actual results against budgeted figures

Answer

Two competitors' financial reports

Answer

Current year totals against prior year totals

Answer

Revenue against industry benchmarks

Question 2

Which financial control practice involves comparing the company's bank statement to its own internal cash records?

Accepted Answer

Bank reconciliation

Answer

Accounts reconciliation

Answer

Cash audit

Answer

Ledger review

Question 3

An office administrator processing expense reports should verify that all claims include:

Accepted Answer

Receipts and a business purpose for each expense

Answer

Supervisor's personal approval only

Answer

A handwritten note from the employee

Answer

Pre-approval from the CFO

Question 4

Accounts receivable represents money:

Accepted Answer

Owed to the company by its customers

Answer

The company owes to suppliers

Answer

Held in reserve for taxes

Answer

Budgeted for future capital projects

Question 5

Which term describes the process of spreading the cost of a long-term asset over its useful life?

Accepted Answer

Depreciation

Answer

Amortization of intangibles only

Answer

Accrual

Answer

Capitalization

Question 6

When preparing an office budget, a 'contingency fund' is included to:

Accepted Answer

Handle unexpected or unplanned expenses

Answer

Cover employee raises automatically

Answer

Pay for planned capital expenditures

Answer

Reimburse client entertainment costs