ICANManagement InformationBudgeting and Budgetary Control2025

Zenith Manufacturing Limited prepares a master budget for the year ended 31 December 2024. Which of the following CORRECTLY describes the master budget?

AA budget that consolidates all functional budgets into a budgeted income statement, budgeted statement of financial position and cash budgetCORRECT
BA budget prepared exclusively for the production department to control manufacturing costs
CA long-range strategic plan covering a period of five to ten years
DA budget that focuses solely on capital expenditure approved by the board under CAMA 2020
AI
Toaster Teacher
Why the answer is A, and why the others tempt you.
The master budget is the culmination of the budgeting process and consolidates all functional (subsidiary) budgets into three key financial statements: the budgeted income statement, the budgeted statement of financial position, and the cash budget. It is not limited to any single department nor is it a long-range strategic plan. Options B, C and D each describe only a component or an unrelated concept.
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