Question 1

A well-developed budget can operate and enforce itself.

Accepted Answer

A) True 
 B)False  False

Question 2

On January 1 Witt Company has a beginning cash balance of $126000.During the year the company expects cash disbursements of $1020000 and cash receipts of $870000.If Witt requires an ending cash balance of $120000 Witt Company must borrow

Accepted Answer

A) $96000. 
B) $120000. 
C) $144000. 
D) $276000. 
A) $96000. 
B) $120000. 
C) $144000. 
D) $276000. C

Question 3

A budget can facilitate the coordination of activities among the segments of a large company.

Accepted Answer

A) True 
 B)False  True

Question 4

An overly optimistic sales budget may result in

Accepted Answer

A) increases in selling prices late in the year. 
B) insufficient inventories. 
C) increased sales during the year. 
D) excessive inventories. 
A) increases in selling prices late in the year. 
B) insufficient inventories. 
C) increased sales during the year. 
D) excessive inventories.

Question 5

A company determined that the budgeted cost of producing a product is $30 per unit.On June 1 there were 80000 units on hand the sales department budgeted sales of 300000 units in June and the company desires to have 120000 units on hand on June 30.The budgeted cost of goods sold for June would be

Accepted Answer

A) $7800000. 
B) $11400000. 
C) $9000000. 
D) $10200000. 
A) $7800000. 
B) $11400000. 
C) $9000000. 
D) $10200000.

Question 6

Long-range plans are used more as a review of progress toward long-term goals rather than an evaluation of specific results to be achieved.

Accepted Answer

A) True 
 B)False

Question 7

The master budget consists of operating and financial budgets.

Accepted Answer

A) True 
 B)False

Question 8

Kam Department Store reported the following information for 2022: $\begin{array} { l  } 
& \text {October }& \text { November}& \text { DECEMBER}\
 \text {Budgeted sales }&\$1,240,000&\$1,160,000&\$1,440,000\
\end{array}$
 All sales are on credit. 
•	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 9

Why are budgets useful in the planning process?

Accepted Answer

A) They provide management with information about the company's past performance. 
B) They help communicate goals and provide a basis for evaluation. 
C) They guarantee the company will be profitable if it meets its objectives. 
D) They enable the budget committee to earn their paycheck. 
A) They provide management with information about the company's past performance. 
B) They help communicate goals and provide a basis for evaluation. 
C) They guarantee the company will be profitable if it meets its objectives. 
D) They enable the budget committee to earn their paycheck.

Question 10

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 11

Budgets are statements of management's plans stated in financial terms.

Accepted Answer

A) True 
 B)False

Question 12

Petal Co.reported the following information for 2022: $$\text { Budgeted sales } \quad \frac { \text { October } } { \$ 930,000 } \quad \frac { \text { November } } { \$ 870,000 } \quad \frac { \text { December } } { \$ 1,080,000 }$$ 
•	All sales are on credit. 
•	Customer amounts on account are collected 50% in the month of sale and 50% in the following month.

How much is the November 30 2022 budgeted Accounts Receivable?

Accepted Answer

A) $900000 
B) $540000 
C) $465000 
D) $435000 
A) $900000 
B) $540000 
C) $465000 
D) $435000

Question 13

Which of the following statements about a budgeted income statement isnot true?

Accepted Answer

A) The budgeted income statement is prepared after the financial budgets are prepared. 
B) The budgeted income statement is prepared on the accrual basis of accounting. 
C) The budgeted income statement can be prepared in a multiple-step format. 
D) The budgeted income statement is prepared using the individual operating budgets. 
A) The budgeted income statement is prepared after the financial budgets are prepared. 
B) The budgeted income statement is prepared on the accrual basis of accounting. 
C) The budgeted income statement can be prepared in a multiple-step format. 
D) The budgeted income statement is prepared using the individual operating budgets.

Question 14

The manufacturing overhead budget generally has separate sections for variable mixed and fixed costs.

Accepted Answer

A) True 
 B)False

Question 15

Mapleview Inc.has the following budgeted sales: July $200000 August $300000 and September $250000.40% of the sales are for cash and 60% are on credit.For the credit sales 50% are collected in the month of sale and 50% the next month.The total expected cash receipts during September are

Accepted Answer

A) $280000. 
B) $265000. 
C) $262500. 
D) $250000. 
A) $280000. 
B) $265000. 
C) $262500. 
D) $250000.

Question 16

Correy Company reported the following information for 2022: $\begin{array}{lll}
&\text { October } & \text { November } & \text { December } \
\text { Budgeted sales }&\$ 460,000 & \$ 440,000 & \$ 540,000 \
\text { Budgeted purchases }&\$ 240,000 & \$ 256,000 & \$ 288,000
\end{array}$ Cost of goods sold is 35% of sales. 
•	Correy purchases and pays for merchandise 60% in the month of acquisition and 40% in the following month. 
•	Accounts payable is used only for inventory acquisitions.

How much is the budgeted balance for Accounts Payable at October 31 2022?

Accepted Answer

A) $96000 
B) $144000 
C) $204000 
D) $102400 
A) $96000 
B) $144000 
C) $204000 
D) $102400

Question 17

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

Accepted Answer

A) True 
 B)False

Question 18

The budget committee would not normally include the

Accepted Answer

A) research director. 
B) treasurer. 
C) sales manager. 
D) external auditor. 
A) research director. 
B) treasurer. 
C) sales manager. 
D) external auditor.

Question 19

Pell Manufacturing is preparing its direct labor budget for May.Projections for the month are that 33400 units are to be produced and that direct labor time is three hours per unit.If the labor cost per hour is $12 what is the total budgeted direct labor cost for May?

Accepted Answer

A) $1159200. 
B) $1180800. 
C) $1202400. 
D) $1296000. 
A) $1159200. 
B) $1180800. 
C) $1202400. 
D) $1296000.

Question 20

The production budget shows that expected unit sales are 48000.The total required units are 54000.What are the required production units?

Accepted Answer

A) 6000 
B) 9000 
C) 12000 
D) Cannot be determined from the data provided. 
A) 6000 
B) 9000 
C) 12000 
D) Cannot be determined from the data provided.

A well-developed budget can operate and enforce itself.

On January 1 Witt Company has a beginning cash balance of $126000.During the year the company expects cash disbursements of $1020000 and cash receipts of $870000.If Witt requires an ending cash balance of $120000 Witt Company must borrow

A budget can facilitate the coordination of activities among the segments of a large company.

An overly optimistic sales budget may result in

A company determined that the budgeted cost of producing a product is $30 per unit.On June 1 there were 80000 units on hand the sales department budgeted sales of 300000 units in June and the company desires to have 120000 units on hand on June 30.The budgeted cost of goods sold for June would be

Long-range plans are used more as a review of progress toward long-term goals rather than an evaluation of specific results to be achieved.

The master budget consists of operating and financial budgets.

Why are budgets useful in the planning process?

Budgets are statements of management's plans stated in financial terms.

Which of the following statements about a budgeted income statement isnot true?

The manufacturing overhead budget generally has separate sections for variable mixed and fixed costs.

Mapleview Inc.has the following budgeted sales: July $200000 August $300000 and September $250000.40% of the sales are for cash and 60% are on credit.For the credit sales 50% are collected in the month of sale and 50% the next month.The total expected cash receipts during September are

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

The budget committee would not normally include the

Pell Manufacturing is preparing its direct labor budget for May.Projections for the month are that 33400 units are to be produced and that direct labor time is three hours per unit.If the labor cost per hour is $12 what is the total budgeted direct labor cost for May?

The production budget shows that expected unit sales are 48000.The total required units are 54000.What are the required production units?

Introduction to Financial Statements

A Further Look at Financial Statements

The Accounting Information System

Accrual Accounting Concepts

Fraud, Internal Control, and Cash

Reporting and Analyzing Long-Lived Assets

Reporting and Analyzing Liabilities and Stockholders Equity

Financial Analysis: the Big Picture

Managerial Accounting

Cost-Volume-Profit

Incremental Analysis

Budgetary Planning

Budgetary Control and Responsibility Accounting

Planning for Capital Investments

Activity Based Costing

Cost-Volume Profit Analysis: Additional Issues

Filters

Exam 14: Standard Costs and Balanced Scorecard

A well-developed budget can operate and enforce itself.

On January 1 Witt Company has a beginning cash balance of $126000.During the year the company expects cash disbursements of $1020000 and cash receipts of $870000.If Witt requires an ending cash balance of $120000 Witt Company must borrow

A budget can facilitate the coordination of activities among the segments of a large company.

An overly optimistic sales budget may result in

A company determined that the budgeted cost of producing a product is $30 per unit.On June 1 there were 80000 units on hand the sales department budgeted sales of 300000 units in June and the company desires to have 120000 units on hand on June 30.The budgeted cost of goods sold for June would be

Long-range plans are used more as a review of progress toward long-term goals rather than an evaluation of specific results to be achieved.

The master budget consists of operating and financial budgets.

Why are budgets useful in the planning process?

Budgets are statements of management's plans stated in financial terms.

Which of the following statements about a budgeted income statement isnot true?

The manufacturing overhead budget generally has separate sections for variable mixed and fixed costs.

Mapleview Inc.has the following budgeted sales: July $200000 August $300000 and September $250000.40% of the sales are for cash and 60% are on credit.For the credit sales 50% are collected in the month of sale and 50% the next month.The total expected cash receipts during September are

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

The budget committee would not normally include the

Pell Manufacturing is preparing its direct labor budget for May.Projections for the month are that 33400 units are to be produced and that direct labor time is three hours per unit.If the labor cost per hour is $12 what is the total budgeted direct labor cost for May?

The production budget shows that expected unit sales are 48000.The total required units are 54000.What are the required production units?

Introduction to Financial Statements

A Further Look at Financial Statements

The Accounting Information System

Accrual Accounting Concepts

Fraud, Internal Control, and Cash

Reporting and Analyzing Long-Lived Assets

Reporting and Analyzing Liabilities and Stockholders Equity

Financial Analysis: the Big Picture

Managerial Accounting

Cost-Volume-Profit

Incremental Analysis

Budgetary Planning

Budgetary Control and Responsibility Accounting

Planning for Capital Investments

Activity Based Costing

Cost-Volume Profit Analysis: Additional Issues

Filters