Please indicate whether the following statements are true $[$T$]$ or false$[$F$]$ by placing a tick on the appropriate letter on the grids provided:

$1.$ The usual starting point in budgeting is to make a forecast of cash receipts and cash

disbursements.

$2.$ Budgets are used for control as well as for planning of operations. TRUE

$3.$ Control involves developing objectives and preparing the various budgets to achieve those

objectives.

$4.$ The direct materials to be acquired for a period must include the raw materials needed for product$-$ ion as well as the ending inventory

$5.$

In companies that have $"$no lay$-$off" policies, the total direct labour cost for a budget period

is computed by taking the total direct labour hours needed to make the budgeted output of

completed units and multiplying them by the direct labour wage rate.

$6.$ Standard costs should generally not be based on the actual costs of prior periods.

$7.$ The standard direct labour rate should NOT include fringe benefits.

$8.$ From a standpoint of cost control, the most effective time to recognize material quantity

variances is when the materials are placed into production.

$9.$ In order to be successful, an organization has to make a choice of whether or not to make

a budget and whether to follow the budget it has created

$10.$ Management by exception means that a manager's attention is directed toward those parts

of the organization where things are not proceeding according to plans.