Correct Answer:
C. Formulation, legislative approval, execution, and audit and evaluation
A typical budget cycle runs from preparation through approval and implementation to audit.
November 13, 2026 · Accounting and Finance MCQs, Public Finance & Budgeting MCQs
The four main stages of the budget cycle are:
Related MCQs
The statement of financial position (balance sheet) shows:
A.
Income and expenses for a period
B.
Cash flows for a period
C.
Assets, liabilities and equity at a particular date
D.
Changes in equity only
Correct answer is:
C. Assets, liabilities and equity at a particular date
Do you agree with this answer?
An expansionary fiscal policy involves:
A.
Reducing government spending and raising taxes
B.
Increasing government spending or cutting taxes
C.
Raising interest rates
D.
Selling government bonds only
Correct answer is:
B. Increasing government spending or cutting taxes
Do you agree with this answer?
Under the cash basis of accounting, transactions are recognized when:
A.
They are earned or incurred
B.
Cash is received or paid
C.
They are budgeted
D.
They are audited
Correct answer is:
B. Cash is received or paid
Do you agree with this answer?
Operating income is Rs. 200,000, invested assets are Rs. 1,000,000 and the required rate of return is 12%. Residual income is:
A.
Rs. 120,000
B.
Rs. 80,000
C.
Rs. 200,000
D.
Rs. 320,000
Correct answer is:
B. Rs. 80,000
Do you agree with this answer?
In a regressive tax system:
A.
The average tax rate rises as income rises
B.
The tax rate is the same for all
C.
Only high incomes are taxed
D.
The average tax rate falls as income rises
Correct answer is:
D. The average tax rate falls as income rises
Do you agree with this answer?
Which of the following is a test of controls?
A.
Confirming receivable balances with customers
B.
Recalculating depreciation expense
C.
Inspecting purchase orders for evidence of authorization signatures
D.
Counting inventory at year end
Correct answer is:
C. Inspecting purchase orders for evidence of authorization signatures
Do you agree with this answer?
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