Question 1

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 2

A budget

Accepted Answer

A) is a substitute for management. 
B) is an aid to management. 
C) can operate or enforce itself. 
D) is the responsibility of the accounting department. 
A) is a substitute for management. 
B) is an aid to management. 
C) can operate or enforce itself. 
D) is the responsibility of the accounting department.

Question 3

Dex Industries expects to purchase $120000 of materials in March and $140000 of materials in April.Three-fourths of all purchases are paid for in the month of purchase and the other one-fourth are paid for in the month following the month of purchase.In addition a 2% discount is received for payments made in the month of purchase.How much will April's cash disbursements for materials purchases be?

Accepted Answer

A) $88200 
B) $108200 
C) $132900 
D) $120000 
A) $88200 
B) $108200 
C) $132900 
D) $120000

Question 4

Comma Co.makes and sells widgets.The company is in the process of preparing its selling and administrative expense budget for the month.The following budget data are available: $\begin{array}{lcr} 
\underline{ \text {tem }} &\underline{ \text { Variable Cost Per Unit Sold }} &\underline{ \text { Monthly Fixed Cost }} \
\text { Sales commissions } & \$ 1 & \$ 10,000 \
\text { Shipping } & \$3 & \
\text { Advertising } & \$4 & \
\text { Executive salaries } & & \$120,000\
\text { Depreciation on office equipment } & & \$4,000\
\text { Other }&\$2&\$6,000
\end{array}$
 Expenses are paid in the month incurred.If the company has budgeted to sell 80000 widgets in October how much is the total budgeted selling and administrative expenses for October?

Accepted Answer

A) $940000 
B) $140000 
C) $930000 
D) $800000 
A) $940000 
B) $140000 
C) $930000 
D) $800000

Question 5

Lorie Nursery plans to sell 320 potted plants during April and 240 units in May.Lorie Nursery keeps 15% of the next month's sales as ending inventory.How many units should Lorie Nursery produce during April?

Accepted Answer

A) 308 
B) 332 
C) 320 
D) 356 
A) 308 
B) 332 
C) 320 
D) 356

Question 6

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 7

Which one of the following isnot  needed in preparing a production budget?

Accepted Answer

A) Budgeted unit sales 
B) Budgeted raw materials 
C) Beginning finished goods units 
D) Ending finished goods units 
A) Budgeted unit sales 
B) Budgeted raw materials 
C) Beginning finished goods units 
D) Ending finished goods units

Question 8

Which of the following is done to improve the reliability of the sales forecast?

Accepted Answer

A) Employ financial planning models 
B) Lengthen the planning horizon to more than a year 
C) Rely solely on outside consultants 
D) Use the sales forecasts from the previous year 
A) Employ financial planning models 
B) Lengthen the planning horizon to more than a year 
C) Rely solely on outside consultants 
D) Use the sales forecasts from the previous year

Question 9

The budget itself and the administration of the budget are entirely accounting responsibilities.

Accepted Answer

A) True 
 B)False

Question 10

If the required direct materials purchases are 24000 pounds the direct materials required for production is three times the direct materials purchases and the beginning direct materials are three and a half times the direct materials purchases what are the desired ending direct materials in pounds?

Accepted Answer

A) 60000 
B) 12000 
C) 36000 
D) 24000 
A) 60000 
B) 12000 
C) 36000 
D) 24000

Question 11

In many companies responsibility for coordinating the preparation of the budget is assigned to

Accepted Answer

A) the company's independent certified public accountants. 
B) the company's internal auditors. 
C) the company's board of directors. 
D) a budget committee. 
A) the company's independent certified public accountants. 
B) the company's internal auditors. 
C) the company's board of directors. 
D) a budget committee.

Question 12

The direct materials budget shows: $\begin{array}{llcc}
  \text {Units to be produced  } &3,000  \
 \text { Total pounds needed for production } &9,000\
 \text { Total materials required } &9,900\
\end{array}$
 What are the direct materials per unit?

Accepted Answer

A) .33 pounds 
B) 3.0 pounds 
C) 3.3 pounds 
D) Cannot be determined from the data provided. 
A) .33 pounds 
B) 3.0 pounds 
C) 3.3 pounds 
D) Cannot be determined from the data provided.

Question 13

Teller Co.is planning to sell 900 boxes of ceramic tile with production estimated at 870 boxes during May.Each box of tile requires 44 pounds of clay mix and a quarter hour of direct labor.Clay mix costs $0.40 per pound and employees of the company are paid $12.00 per hour.Manufacturing overhead is applied at a rate of 110% of direct labor costs.Teller has 3900 pounds of clay mix in beginning inventory and wants to have 4500 pounds in ending inventory. What is the total amount to be budgeted in pounds for direct materials to be purchased for the month?

Accepted Answer

A) 38280 
B) 37680 
C) 38880 
D) 40200 
A) 38280 
B) 37680 
C) 38880 
D) 40200

Question 14

The master budget reflects management's long-term plans encompassing five years or more.

Accepted Answer

A) True 
 B)False

Question 15

Financial budgets must be completed before the operating budgets can be prepared.

Accepted Answer

A) True 
 B)False

Question 16

The number of direct labor hours needed for production is obtained from the production budget.

Accepted Answer

A) True 
 B)False

Question 17

Which of the following is not an operating budget?

Accepted Answer

A) Direct labor budget 
B) Sales budget 
C) Production budget 
D) Cash budget 
A) Direct labor budget 
B) Sales budget 
C) Production budget 
D) Cash budget

Question 18

The budget committee has the responsibility for coordinating the preparation of the budget.

Accepted Answer

A) True 
 B)False

Question 19

Which one of the following is not a benefit of budgeting?

Accepted Answer

A) It facilitates the coordination of activities. 
B) It provides definite objectives for evaluating performance. 
C) It provides assurance that the company will achieve its objectives. 
D) It requires all levels of management to plan ahead on a recurring basis. 
A) It facilitates the coordination of activities. 
B) It provides definite objectives for evaluating performance. 
C) It provides assurance that the company will achieve its objectives. 
D) It requires all levels of management to plan ahead on a recurring basis.

Question 20

The direct materials budget details 1. the quantity of direct materials to be purchased.
2. the cost of direct materials to be purchased.

Accepted Answer

A) 1 
B) 2 
C) both 1 and 2 
D) neither 1 nor 2 
A) 1 
B) 2 
C) both 1 and 2 
D) neither 1 nor 2

The single most important output in preparing financial budgets is the

A budget

Lorie Nursery plans to sell 320 potted plants during April and 240 units in May.Lorie Nursery keeps 15% of the next month's sales as ending inventory.How many units should Lorie Nursery produce during April?

Which of the following is not a financial budget?

Which one of the following isnot needed in preparing a production budget?

Which of the following is done to improve the reliability of the sales forecast?

The budget itself and the administration of the budget are entirely accounting responsibilities.

If the required direct materials purchases are 24000 pounds the direct materials required for production is three times the direct materials purchases and the beginning direct materials are three and a half times the direct materials purchases what are the desired ending direct materials in pounds?

In many companies responsibility for coordinating the preparation of the budget is assigned to

The direct materials budget shows: Units to be produced 3,000 Total pounds needed for production 9,000 Total materials required 9,900 What are the direct materials per unit?

The master budget reflects management's long-term plans encompassing five years or more.

Financial budgets must be completed before the operating budgets can be prepared.

The number of direct labor hours needed for production is obtained from the production budget.

Which of the following is not an operating budget?

The budget committee has the responsibility for coordinating the preparation of the budget.

Which one of the following is not a benefit of budgeting?

The direct materials budget details 1. the quantity of direct materials to be purchased. 2. the cost of direct materials to be purchased.

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

The single most important output in preparing financial budgets is the

A budget

Lorie Nursery plans to sell 320 potted plants during April and 240 units in May.Lorie Nursery keeps 15% of the next month's sales as ending inventory.How many units should Lorie Nursery produce during April?

Which of the following is not a financial budget?

Which one of the following isnot needed in preparing a production budget?

Which of the following is done to improve the reliability of the sales forecast?

The budget itself and the administration of the budget are entirely accounting responsibilities.

If the required direct materials purchases are 24000 pounds the direct materials required for production is three times the direct materials purchases and the beginning direct materials are three and a half times the direct materials purchases what are the desired ending direct materials in pounds?

In many companies responsibility for coordinating the preparation of the budget is assigned to

The direct materials budget shows: Units to be produced 3,000 Total pounds needed for production 9,000 Total materials required 9,900 What are the direct materials per unit?

The master budget reflects management's long-term plans encompassing five years or more.

Financial budgets must be completed before the operating budgets can be prepared.

The number of direct labor hours needed for production is obtained from the production budget.

Which of the following is not an operating budget?

The budget committee has the responsibility for coordinating the preparation of the budget.

Which one of the following is not a benefit of budgeting?

The direct materials budget details 1. the quantity of direct materials to be purchased. 2. the cost of direct materials to be purchased.

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