Which of the following are correct statements about a budget?

it is a formal written statement of management's plans for a specified future time period.

it becomes an important basis for evaluating performance.

it promotes efficiency and serves as a deterrent to waste and inefficiency.

all of these options are correct statements.

All of the options are correct

Explanation:

It is a formal written statement of management's plans for a specified future time period. Management develops budgets to organice financial and economic efforts towards achieving goals (e.g. sales, variable costs, fixed costs, depreciation, amortization, etc.). Budgets are developed through out a process in which all business and support areas should be involved, sharing valuable inputs about business variables such as demand, client behavior, operations efficiency, among others. Budget should have a future vision, leveraging on historical data to enhance quality of projections.

It becomes an important basis for evaluating performance. It's a key instrument to assess how different lines of product / business are achieving their goals, allowing adjustments and the implementation of corrective actions.

It promotes efficiency and serves as a deterrent to waste and inefficiency, due to the fact that it allows to quantify and measure the impact of applying different actions and policies.