Budgetary control system involves: MCQ with Answer and Explanation

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Budgetary control system involves:

A. Comparing actual figures with budgeted figures

B. Setting long-term objectives

C. Only preparing cash budget

D. Fixing selling price

Answer: Option A

Solution (By JKSSB Mock Tests)

Budgetary control is the establishment of budgets relating to responsibilities of executives to the requirements of a policy and the continuous comparison of actual with budgeted results.

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Question #1

The concept of 'Cost Control' differs from 'Cost Reduction' in that Cost Control:

A. Assumes a permanent reduction in unit cost

B. Is applicable only to research and development

C. Seeks to maintain costs within predefined standards/budgets

D. Challenges existing standards to find cheaper methods

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Correct Answer: Option C

Explanation:
Cost control ensures costs do not exceed the set budget/standard, while cost reduction seeks to permanently lower the standard itself.

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Question #2

Which of the following deductions is not allowed under the new income tax regime (default)?

A. Section 80C (PPF, LIC, etc.)

B. Standard deduction on salary

C. Section 80CCD(2) (employer contribution to NPS)

D. Section 24(b) interest on housing loan (let-out property)

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Correct Answer: Option A

Explanation:
Under the new regime, Section 80C deductions are not allowed.

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Question #3

The 'Interim Financial Report' should include:

A. Only a condensed balance sheet

B. Condensed set of financial statements and selected explanatory notes

C. Only profit and loss

D. Full annual report

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Correct Answer: Option B

Explanation:
As per Ind AS 34, interim report includes condensed statements and notes.

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