Giving a maximum travel expense limit to the sales department relates to which plan?
Answer and explanation
Correct answer: Budget
A budget is a plan expressed in numerical terms that sets out expected income, expenditure, or use of resources. Fixing a maximum amount for the sales department's travel expenses is a financial allocation, so it is a budget. A rule gives a definite instruction about what must or must not be done; here, the focus is on a monetary limit. Exam tip: Words such as amount, cost, expense limit, or numerical target usually point to a budget.
Frequently asked questions
What is the correct answer to this question?
Budget
Why is this the correct answer?
A budget is a plan expressed in numerical terms that sets out expected income, expenditure, or use of resources. Fixing a maximum amount for the sales department's travel expenses is a financial allocation, so it is a budget. A rule gives a definite instruction about what must or must not be done; here, the focus is on a monetary limit. Exam tip: Words such as amount, cost, expense limit, or numerical target usually point to a budget.
Which subject and chapter does this question cover?
This is a Class 12 Business Studies question. Chapter: Planning. Topic: Types of plans.
