Question 1

The budgeted balance sheet is prepared entirely from the budgets for the current year.

Accepted Answer

A) True 
 B)False

Question 2

A company's past experience indicates that 60% of its credit sales are collected in the month of sale 30% in the next month and 5% in the second month after the sale; the remainder is never collected. Budgeted credit sales were: $$\begin{array} { l r } 
\text { January } & \$ 360,000 \
\text { February } & 216,000 \
\text { March } & 540,000
\end{array}$$ The cash inflow in the month of March is expected to be

Accepted Answer

A)  $406800. 
B)  $307800. 
C)  $324000. 
D)  $388800. 
A)  $406800. 
B)  $307800. 
C)  $324000. 
D)  $388800.

Question 3

Kam Department Store reported the following information for 2016: $ \quad  \quad  \quad  \quad  \quad  \quad  \quad  \quad  \text { October }  \quad \text { November }  \quad  \quad  \text { December } $
$\text { Budgeted sales }  \quad \$ 1,240,000 \quad \$ 1,160,000 \quad \$ 1,440,000$ All sales are on credit.
$\bullet$Customer amounts on account are collected 50% in the month of sale and 50% in the following month.
How much cash will Kam receive in November?

Accepted Answer

A)  $580000 
B)  $1300000 
C)  $1200000 
D)  $1160000 
A)  $580000 
B)  $1300000 
C)  $1200000 
D)  $1160000

Question 4

An appropriate activity index for a college or university for budgeting faculty positions would be the

Accepted Answer

A)  faculty hours worked. 
B)  number of administrators. 
C)  credit hours taught by a department. 
D)  number of days in the school term. 
A)  faculty hours worked. 
B)  number of administrators. 
C)  credit hours taught by a department. 
D)  number of days in the school term.

Question 5

Dolce Co. estimates its sales at 180000 units in the first quarter and that sales will increase by 18000 units each quarter over the year. They have and desire a 25% ending inventory of finished goods. Each unit sells for $25. 40% of the sales are for cash. 70% of the credit customers pay within the quarter. The remainder is received in the quarter following sale. Cash collections for the third quarter are budgeted at

Accepted Answer

A)  $3051000. 
B)  $4428000. 
C)  $5319000. 
D)  $6156000. 
A)  $3051000. 
B)  $4428000. 
C)  $5319000. 
D)  $6156000.

Question 6

A merchandiser has a merchandise purchases budget rather than a production budget.

Accepted Answer

A) True 
 B)False

Question 7

Accounting generally has the responsibility for

Accepted Answer

A)  setting company goals. 
B)  expressing the budget in financial terms. 
C)  enforcing the budget. 
D)  administration of the budget. 
A)  setting company goals. 
B)  expressing the budget in financial terms. 
C)  enforcing the budget. 
D)  administration of the budget.

Question 8

A common starting point in the budgeting process is

Accepted Answer

A)  expected future net income. 
B)  past performance. 
C)  to motivate the sales force. 
D)  a clean slate with no expectations. 
A)  expected future net income. 
B)  past performance. 
C)  to motivate the sales force. 
D)  a clean slate with no expectations.

Question 9

The direct materials and direct labor budgets provide information for preparing the

Accepted Answer

A)  sales budget. 
B)  production budget. 
C)  manufacturing overhead budget. 
D)  cash budget. 
A)  sales budget. 
B)  production budget. 
C)  manufacturing overhead budget. 
D)  cash budget.

Question 10

Which of the following is not a financial budget?

Accepted Answer

A)  Capital expenditure budget 
B)  Cash budget 
C)  Manufacturing overhead budget 
D)  Budgeted balance sheet 
A)  Capital expenditure budget 
B)  Cash budget 
C)  Manufacturing overhead budget 
D)  Budgeted balance sheet

Question 11

The direct materials budget must be completed before the production budget because the quantity of materials available for production must be known.

Accepted Answer

A) True 
 B)False

Question 12

Benet Company has budgeted the following unit sales:   The finished goods inventory on hand on December 31 2015 was 21000 units. It is the company's policy to maintain a finished goods inventory at the end of each quarter equal to 20% of the next quarter's anticipated sales.
Instructions
Prepare a production budget for 2016.

Accepted Answer

The answer of Benet Company has budgeted the following unit...

Question 13

Grey Company has 24000 units in beginning finished goods. If sales are expected to be 120000 units for the year and Grey desires ending finished goods of 30000 units how many units must the company produce?

Accepted Answer

A)  114000 
B)  120000 
C)  126000 
D)  150000 
A)  114000 
B)  120000 
C)  126000 
D)  150000

Question 14

If budgets are to be effective all of the following must be present except

Accepted Answer

A)  acceptance at all levels of management. 
B)  research and analysis in setting realistic goals. 
C)  stockholders' approval of the budget. 
D)  sound organizational structure. 
A)  acceptance at all levels of management. 
B)  research and analysis in setting realistic goals. 
C)  stockholders' approval of the budget. 
D)  sound organizational structure.

Question 15

Which is the last step in developing the master budget?

Accepted Answer

A)  Preparing the budgeted balance sheet 
B)  Preparing the cost of goods manufactured budget 
C)  Preparing the budgeted income statement 
D)  Preparing the cash budget 
A)  Preparing the budgeted balance sheet 
B)  Preparing the cost of goods manufactured budget 
C)  Preparing the budgeted income statement 
D)  Preparing the cash budget

Question 16

A master budget consists of

Accepted Answer

A)  an interrelated long-term plan and operating budgets. 
B)  financial budgets and a long-term plan. 
C)  interrelated financial budgets and operating budgets. 
D)  all the accounting journals and ledgers used by a company. 
A)  an interrelated long-term plan and operating budgets. 
B)  financial budgets and a long-term plan. 
C)  interrelated financial budgets and operating budgets. 
D)  all the accounting journals and ledgers used by a company.

Question 17

Financial planning models and statistical and mathematical techniques may be used in forecasting sales.

Accepted Answer

A) True 
 B)False

Question 18

What is the proper preparation sequencing of the following budgets?
1) Budgeted Balance Sheet
2) Sales Budget
3) Selling and Administrative Budget
4) Budgeted Income Statement

Accepted Answer

A)  1 2 3 4 
B)  2 3 1 4 
C)  2 3 4 1 
D)  2 4 1 3 
A)  1 2 3 4 
B)  2 3 1 4 
C)  2 3 4 1 
D)  2 4 1 3

Question 19

The single most important output in preparing financial budgets is the

Accepted Answer

A)  sales forecast. 
B)  determination of the unit cost of the product. 
C)  cash budget. 
D)  budgeted income statement. 
A)  sales forecast. 
B)  determination of the unit cost of the product. 
C)  cash budget. 
D)  budgeted income statement.

Question 20

A __________________ is responsible for coordinating the preparation of the budget in many companies.

Accepted Answer

The answer of A __________________ is responsible for coordinating the...

Exam 23: Budgetary Planning

The budgeted balance sheet is prepared entirely from the budgets for the current year.

An appropriate activity index for a college or university for budgeting faculty positions would be the

A merchandiser has a merchandise purchases budget rather than a production budget.

Accounting generally has the responsibility for

A common starting point in the budgeting process is

The direct materials and direct labor budgets provide information for preparing the

Which of the following is not a financial budget?

The direct materials budget must be completed before the production budget because the quantity of materials available for production must be known.

Grey Company has 24000 units in beginning finished goods. If sales are expected to be 120000 units for the year and Grey desires ending finished goods of 30000 units how many units must the company produce?

If budgets are to be effective all of the following must be present except

Which is the last step in developing the master budget?

A master budget consists of

Financial planning models and statistical and mathematical techniques may be used in forecasting sales.

What is the proper preparation sequencing of the following budgets? 1) Budgeted Balance Sheet 2) Sales Budget 3) Selling and Administrative Budget 4) Budgeted Income Statement

The single most important output in preparing financial budgets is the

A __________________ is responsible for coordinating the preparation of the budget in many companies.

Accounting in Action

The Recording Process

Adjusting the Accounts

Completing the Accounting Cycle

Accounting for Merchandising Operations

Inventories

Accounting Information Systems

Fraud, Internal Control, and Cash

Accounting for Receivables

Plant Assets, Natural Resources, and Intangible Assets

Current Liabilities and Payroll Accounting

Accounting for Partnerships

Corporations: Organization and Capital Stock Transactions

Corporations: Dividends, Retained Earnings, and Income Reporting

Long-Term Liabilities

Investments

Statement of Cash Flows

Financial Statement Analysis

Managerial Accounting

Job Order Costing

Process Costing

Cost-Volume-Profit

Budgetary Control and Responsibility Accounting

Standard Costs and Balanced Scorecard

Incremental Analysis and Capital Budgeting

Time Value of Money

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