The following sales budget has been prepared: $\begin{array}{lll} \text { Month } & \text { Cash Sales } & \text { Credit } \text { Sales } \\ \text { September } & \$ 123,000 & \$ 210,000 \\ \text { October } & 125,000 & 180,000 \\ \text { November } & 167,000 & 260,000 \\ \text { December } & 189,000 & 190,000 \end{array}$ Collections are 50% in the month of sale, 40% in the month following the sale, and 10% two months following the sale. No uncollectible accounts are anticipated. is the estimated cash collection in October from October sales

A) $295,000 B) $215,000 C) $125,000 D) None of these answers is correct. A) $295,000 B) $215,000 C) $125,000 D) None of these answers is correct.

Cedar Rapids Corporation has the following information: $\begin{array}{lr} \text { Month } & \text { Budgeted Purchases } \\ \hline \text { August } & \$ 35,000 \\ \text { September } & 38,000 \\ \text { October } & 43,500 \\ \text { November } & 36,500 \\ \text { December } & 46,000 \end{array}$ Purchases are paid for in the following manner: 40% in the month of purchase 50% in the month after purchase 10% two months after purchase Is the estimated cash disbursement in September from August purchases.

A) $10,500 B) $7,000 C) $19,000 D) $17,500 A) $10,500 B) $7,000 C) $19,000 D) $17,500

The following sales budget has been prepared: $\begin{array}{lll} \text { Month } & \text { Cash Sales } & \text { Credit Sales } \\ \text { September } & \$ 100,000 & \$ 200,000 \\ \text { October } & 125,000 & 180,000 \\ \text { November } & 130,000 & 210,000 \\ \text { December } & 135,000 & 190,000 \end{array}$ Collections are 50% in the month of sale, 40% in the month following the sale, and 10% two months following the sale. No uncollectible accounts are anticipated. is the estimated cash collection in September from September sales.

A) $200,000 B) $300,000 C) $100,000 D) $272,000 A) $200,000 B) $300,000 C) $100,000 D) $272,000

Convoy Company has the following information: $\begin{array}{lc} \text { Month } & \text { Budgeted Sales } \\ \text { April } & \$ 154,000 \\ \text { May } & 160,000 \\ \text { June } & 142,000 \\ \text { July } & 136,000 \end{array}$ $\text { Budgeted Expenses per Month: }$ $\begin{array}{ll} \text { Wages } & \$ 28,600 \\ \text { Advertising } & 27,200 \\ \text { Depreciation } & 19,000 \\ \text { Rent } & 20,400 \\ \text { Freight-out } & 20 \% \text { of sales } \\ \text { Other } & 8 \% \text { of sales } \end{array}$ Note: All cash expenses are paid when incurred. Required: Prepare a combined schedule of total operating expenses and cash disbursements for expenses for April through June.

The answer of Convoy Company has the following information: \(\begin{array}{lc} \text...

Letterman Company has gathered the following information: $\begin{array}{lr} \text { March 31 endingcash balance } & \$ 80,000 \\ \text { Depreciation expense for April } & \$ 12,000 \\ \text { Dividends paid in April } & \$ 55,000 \\ \text { Cash collections in April } & \$ 510,000 \\ \text { Equipment purchase for cash in April } & \$ 94,500 \\ \text { Cash paid for operating expenses in April } & \$ 185,500 \\ \text { Merchandise paid for in April } & \$ 180,000 \end{array}$ Letter man Company requires a minimum cash balance of $\$ 80,000$. Required: Prepare a cash budget for April, and comment on whether or not minimum cash balance requirements are met.

@#IMG-DLM& Minimum cash balance requirem

Mustang Company has the following data: \[\begin{array} { l l } \text { Month } & \text { Budgeted Sales } \\ \text { January } & \$ 108,000 \\ \text { February } & 132,000 \\ \text { March } & 144,000 \\ \text { April } & 120,000 \end{array}\] The average mark- up on products is 40%, and the inventory at the end of December was $19,000. Desired inventory levels are 30% of next month's sales at cost. _ is the desired ending inventory for April.

A) $43,200 B) $25,920 C) $17,280 D) None of these answers is correct. A) $43,200 B) $25,920 C) $17,280 D) None of these answers is correct.

Aluminum Company's expected sales for April are $27,600. Information about other budgeted expenses is presented below. $\begin{array} { l } \text { Budgeted}& \text {Expensesper Month } \\ \ \text {Wages }&\$2,000\\ \text { Advertising}&1,680\\ \text {Depreciation }&1,440\\ \text {Rent }&2,560\\ \text {Other }& \text { 5\% of sales} \\ \end{array}$ All cash expenses are paid as incurred is the total expected cash disbursements for expenses in April.

A) $7,680 B) $7,620 C) $6,240 D) $9,060 A) $7,680 B) $7,620 C) $6,240 D) $9,060

Exam 7: The Master Budget

The following sales budget has been prepared: Month Cash Sales Credit Sales September \ 123,000 \ 210,000 October 125,000 180,000 November 167,000 260,000 December 189,000 190,000 Collections are 50% in the month of sale, 40% in the month following the sale, and 10% two months following the sale. No uncollectible accounts are anticipated. is the estimated cash collection in October from October sales

(Multiple Choice)

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Question 81

The most forward- looking budget is the strategic plan.

(True/False)

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Question 82

All of the following are financial budgets except:

(Multiple Choice)

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Question 83

Cedar Rapids Corporation has the following information: Month Budgeted Purchases August \ 35,000 September 38,000 October 43,500 November 36,500 December 46,000 Purchases are paid for in the following manner: 40% in the month of purchase 50% in the month after purchase 10% two months after purchase Is the estimated cash disbursement in September from August purchases.

(Multiple Choice)

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(84)

Question 84

Budgets are a manager's tool to plan, understand, and control operations.

(True/False)

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Question 85

The most important advantage of a spreadsheet is that:

(Multiple Choice)

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Question 86

Decisions made during long- range planning include the design of a new plant and whether to delete a product from a company's product line.

(True/False)

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Question 87

Financial planning models enable managers to get answers to "what- if" questions.

(True/False)

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Question 88

The following sales budget has been prepared: Month Cash Sales Credit Sales September \ 100,000 \ 200,000 October 125,000 180,000 November 130,000 210,000 December 135,000 190,000 Collections are 50% in the month of sale, 40% in the month following the sale, and 10% two months following the sale. No uncollectible accounts are anticipated. is the estimated cash collection in September from September sales.

(Multiple Choice)

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(80)

Question 89

Budgets generate negative feelings if:

(Multiple Choice)

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Question 90

Convoy Company has the following information: Month Budgeted Sales April \ 154,000 May 160,000 June 142,000 July 136,000 $\text { Budgeted Expenses per Month: }$ Wages \ 28,600 Advertising 27,200 Depreciation 19,000 Rent 20,400 Freight-out 20\% of sales Other 8\% of sales Note: All cash expenses are paid when incurred. Required: Prepare a combined schedule of total operating expenses and cash disbursements for expenses for April through June.

(Essay)

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Question 91

Greedy Company expects August sales to be $32,000. Approximately 25% of sales are cash sales. Collections are 50% in the month of sale, 40% in the month following the sale, and 5% two months following the sale. The remaining 5% is expected to be uncollectible. is the expected cash collection in August from August sales.

(Multiple Choice)

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Question 92

What are some criticisms of the budgeting process?

(Essay)

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Question 93

Letterman Company has gathered the following information: March 31 endingcash balance \ 80,000 Depreciation expense for April \ 12,000 Dividends paid in April \ 55,000 Cash collections in April \ 510,000 Equipment purchase for cash in April \ 94,500 Cash paid for operating expenses in April \ 185,500 Merchandise paid for in April \ 180,000 Letter man Company requires a minimum cash balance of $\$ 80,000$ . Required: Prepare a cash budget for April, and comment on whether or not minimum cash balance requirements are met.

(Essay)

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Question 94

Florida Company expects a total of $10,000 in sales in May, of these, $4,000 sales are expected to be for cash. Collections are 50% in the month of sale, 40% in the month following the sale, and 5% two months following the sale. The remaining 5% is expected to be uncollectible. is the estimated cash collection in May from May sales.

(Multiple Choice)

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Question 95

Mustang Company has the following data: Month Budgeted Sales January \ 108,000 February 132,000 March 144,000 April 120,000 The average mark- up on products is 40%, and the inventory at the end of December was $19,000. Desired inventory levels are 30% of next month's sales at cost. _ is the desired ending inventory for April.

(Multiple Choice)

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(80)

Question 96

Aluminum Company's expected sales for April are $27,600. Information about other budgeted expenses is presented below. Budgeted Expensesper Month \ Wages \2 ,000 Advertising 1,680 Depreciation 1,440 Rent 2,560 Other 5\% of sales All cash expenses are paid as incurred is the total expected cash disbursements for expenses in April.

(Multiple Choice)

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Question 97

Preparing the master budget begins by establishing:

(Multiple Choice)

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Question 98

The operating budget is a better measure of a company's overall performance than is the financial budget.

(True/False)

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Question 99

The first budget in the budgeting process

(Short Answer)

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Question 100

The most forward- looking budget is the strategic plan.

All of the following are financial budgets except:

Budgets are a manager's tool to plan, understand, and control operations.

The most important advantage of a spreadsheet is that:

Decisions made during long- range planning include the design of a new plant and whether to delete a product from a company's product line.

Financial planning models enable managers to get answers to "what- if" questions.

Budgets generate negative feelings if:

What are some criticisms of the budgeting process?

Preparing the master budget begins by establishing:

The operating budget is a better measure of a company's overall performance than is the financial budget.

The first budget in the budgeting process

Managerial Accounting and the Business Organization

Introduction to Cost Behavior and Cost Volume Relationships

Measurement of Cost Behavior

Cost Management Systems and Activity-Based Costing

Relevant Information and Decision-Making: Marketing Decisions

Relevant Information and Decision-Making: Product Decisions

Flexible Budget and Variance Analysis

Management Control Systems and Responsibility Accounting

Management Control in Decentralized Organizations

Capital Budgeting

Cost Allocation

Job-Costing

Process-Costing Systems

Overhead Application: Variable and Absorbtion Costing

Basic Accounting Concepts, Techniques, and Conventions

Understanding Corporate Annual Reports: Basic Financial Statements

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