1. What is the preferred step to be taken by the management of a hotel prior to the preparation of an operations budget?

a) Benchmark the Competition

b) Estimate Future Revenues

c) Set Financial Objectives

d) Estimate Level of Fixed Costs

2. True or False? The operations budget includes only budgets for profit centers, such as the Rooms and the F and B departments of a hotel.

a) True

b) False

3. True or False? One of the major benefits of budgeting is that it provides a standard against which to compare the forecast results of operations.

a) True

b) False

4. True or False? In a hotel operation, budget preparation should generally be the sole responsibility of the controller.

a) True

b) False

5. True or False? Budgets prepared for different projected levels of activity are commonly referred to as flexible budgets.

a) True

b) False