Questions:
1. Discuss the sequence in which the major components of the master budget are pre-pared. Why is it necessary to prepare the components in such a sequence?
2. The cash budget and the budgeted statement of cash flows both provide information about cash. What information about cash is common to these two sources, and what information is unique to the two sources?
3. Why is continuous (rolling) budgeting becoming more popular than it was in the past for organizational managers?
4. If the majority of companies find that their forecasts are inaccurate, why should man-agers engage in budgeting at all?
5. What is budgetary slack, and what might top managers do to rid their firms' budgets of slack?
6. Why is it helpful for a company to prepare a budget manual?