Question

Assertion (1): Financial planning tries to link the present with the future.

Reason (R): Financial planning is essentially the preparation of a financial blueprint of an organisation's future operations.

Options

• Both (1) and (R) are true, and (R) is the correct explanation of (1).

• Both (1) and (R) are true, but (R) is not the correct explanation of (1).

• (1) is true, but (R) is false

• (1) is false, but (R) is true.

Answer 1

Both (1) and (R) are true, and (R) is the correct explanation of (1).

Explanation -

Financial planning entails selecting ahead of time how much to spend and on what, based on the cash available. It enables the management to anticipate the financial requirements, both in terms of quantity and timing.