Answer (A) is correct . A continuous, or rolling, budget (profit plan) is one that is revised on a regular or continuous basis. Typically, a company that uses continuous budgeting extends the budget for another month or quarter in accordance with new data as the current month or quarter ends. For example, if the budget is for 12 months, a budget for the next year will always be available at the end of each interim period. Continuous budgeting encourages a longer-term perspective regardless of how little time remains in the company’s current fiscal year.
Answer (B) is incorrect because A continuous profit plan is one that is revised and extended as available information changes.
Answer (C) is incorrect because A continuous plan can be prepared by either a full-time or part-time staff.
Answer (D) is incorrect because It is the lack of reliable long-range information that makes the continuous profit plan so worthwhile.
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