Reference no: EM132229311

1. What are reasons the finance department should oversee the development and budgeting of a company's capital program?

Many FM's have prior experience and training in capital project work

Because capital budgeting involves significant company resources, the finance people should remain the primary responsible party

Because capital projects often are multi-disciplinary and extend beyond just one year

Because capital budgeting involves significant company resources, the finance people should remain the primary responsible party and capital projects often are multi-disciplinary and extend beyond just one year

Because capital budgeting involves significant company resources, the finance people should remain the primary responsible party and many FM's have prior experience and training in capital project work

2. Burn rate is something a FM needs to be aware of as the budget year progresses. This term can be defined as:

The amount of incinerated refuse that takes place annually

An annual expense profile

How long a FM will last in a particular company or firm

None of the above

3. When a FM requests funds and successfully justifies those funds for a project through the approval process, what has he done?

Allocated

Committed

Obligated

Made them fungible

4. Blanket Purchase Orders provide flexibility to the FM in what way?

Commits funds but are fungible and can be used for any project

Provide the FM with ability to fill repetitive needs for small quantities of goods and/or services

Dedicated to a particular vendor for services

Allows the FM to purchase services for any fiscal year

5. Who sets the rules in terms of accounting, depreciation, and capitalization?

Typically the COO

Ordinarily the CFO

Usually the CIO

Most commonly the CTO