Actual revenues and expenditures reported on a budget and actual comparison schedule should be prepared on the same basis as budgeted revenues and expenditures, even if a cash basis is used. Do you agree with this statement? Why or why not?© BrainMass Inc. brainmass.com June 4, 2020, 3:10 am ad1c9bdddf
Yes, I agree with this statement. When the initial budget and comparison are prepared, the format and method used should be identical. When comparing variances and line items between the comparison schedule and the master budget or other budget being used, it would be most effective if both were under the same method. ...
This solution explains if it is correct that actual revenues and expenditures which are reported on a budget and actual comparison schedule should be prepared on the same basis. I explain the reasons why this should or should not be considered correct. A thorough explanation is provided.