Match the appropriate letter for the key term or concept to each definition provided (items 1-12). Note that not all key terms and concepts will be used.
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a.
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Budgeting
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j.
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Committed cost
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b.
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Top-down budgeting
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k.
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Discretionary cost
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c.
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Participative budgeting
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l.
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Standard cost
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d.
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Zero-based budgeting
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m.
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Ideal (or engineered) standard
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e.
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Single-period budget
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n.
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Attainable standard
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f.
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Rolling (or continuous) budget
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o.
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Past experience standard
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g.
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Operating budget
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p.
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Predetermined overhead
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h.
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Budget slack (or budget padding)
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application rate
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i.
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Cash budget
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1. A budgeting process that involves justifying resource requirements based on an analysis and prioritization of unit objectives without reference to prior period budget allowances.
2. A budgeting approach that implies little or no input from lower levels of management.
3. A budget that is prepared for several periods in the future and that is revised several times prior to the budget period.
4. A plan comprised of the sales budget (or sales forecast), the purchases/ production budget, the operating expense budget, the income statement budget, the cash budget, and the budgeted balance sheet.
5. A budgeting process that involves input and negotiation at several management layers.
6. Allowances for contingencies built into a budget.
7. A cost that is incurred because of a long-range policy decision.
8. A unit budget allowance for a cost component of a product or an activity.
9. A standard cost or production standard that is based on historical data.
10. A standard cost or production standard that assumes optimal operating conditions and maximum efficiency at all times.
11. The rate per unit of activity (e.g., direct labor hour) used to apply manufacturing overhead to work in process.
12. A standard cost or production standard that is achievable under actual operating conditions.