Question : Statement 1: A budget is a tertiary plan.
Statement 2: Budgeting helps in controlling financial activities.
Option 1: Both statements are correct.
Option 2: Only statement 1 is correct.
Option 3: Only statement 2 is correct.
Option 4: Neither statement 1 nor statement 2 is correct.
Correct Answer:
Both statements are correct.
Solution : The correct answer is (a) Both statements are correct.
Statement 1 is correct. A budget is often considered a tertiary plan because it is a detailed and specific financial plan that supports the broader strategic and operational plans of an organization.
Statement 2 is correct. Budgeting involves the process of planning and controlling financial activities by setting specific financial targets, allocating resources, and monitoring actual performance against the budgeted figures.
Therefore, both statements 1 and 2 are correct.
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