The term 'Zero-Based Budgeting' (ZBB) requires: MCQ with Answer and Explanation

Question

Share Report Error

The term 'Zero-Based Budgeting' (ZBB) requires:

A. Preparing the budget from scratch every year

B. Setting the budget to zero

C. Ignoring all costs

D. Using the previous year's budget as a base

Answer: Option A

Solution (By JKSSB Mock Tests)

Zero-Based Budgeting requires every expense to be justified for each new period, starting from a 'zero base' rather than using previous budgets.

This question belongs to: Accountancy and Statistics Accountancy and Book Keeping

Request complete Subject PDF

Discuss this Question (0)

No comments yet. Be the first to start the discussion!

Practice More Accountancy and Book Keeping Questions

Question #1

'Borrowing Costs' eligible for capitalization are determined as per:

A. AS 16

B. AS 9

C. AS 10

D. AS 12

View Answer & Solution Discuss

Get Complete Subject PDF for Accountancy and Statistics

Correct Answer: Option A

Explanation:
AS 16 Borrowing Costs provides guidance on capitalization of borrowing costs on qualifying assets.

This question belongs to: Accountancy and Statistics Accountancy and Book Keeping

Question #2

A firm's break-even point is 4,000 units. The variable cost per unit is ₹20, and the fixed cost is ₹40,000. What is the selling price per unit?

A. ₹35

B. ₹40

C. ₹25

D. ₹30

View Answer & Solution Discuss

Get Complete Subject PDF for Accountancy and Statistics

Correct Answer: Option D

Explanation:
At BEP, Total Contribution = Fixed Costs. Contribution per unit = Fixed Cost / BEP units = 40,000 / 4,000 = ₹10. Selling Price = Variable Cost + Contribution = 20 + 10 = ₹30.

This question belongs to: Accountancy and Statistics Accountancy and Book Keeping

Question #3

Which of the following is a current asset?

A. Machinery

B. Prepaid Insurance

C. Goodwill

D. Building

View Answer & Solution Discuss

Get Complete Subject PDF for Accountancy and Statistics

Correct Answer: Option B

Explanation:
Prepaid insurance is a current asset because it represents an expense paid in advance that will provide a benefit within the next 12 months.

This question belongs to: Accountancy and Statistics Accountancy and Book Keeping

Explore All Accountancy and Book Keeping MCQs