Question 1

Which of the following items would be shown on a cash payments budget?

Accepted Answer

A) Bad debt expense 
B) Depreciation expense 
C) Cash dividends 
D) Gains on sales of equipment 
A) Bad debt expense 
B) Depreciation expense 
C) Cash dividends 
D) Gains on sales of equipment

Question 2

Which of the following is not part of the operating budget?

Accepted Answer

A) Inventory, purchases and cost of goods sold budget 
B) Cash budget 
C) Sales budget 
D) Budgeted income statement 
A) Inventory, purchases and cost of goods sold budget 
B) Cash budget 
C) Sales budget 
D) Budgeted income statement

Question 3

Two Brothers Moving prepared the following sales budget:   Credit collections are 25% in the month of sale, 60% in the month following the sale, and 10% two months following the sale. The remaining 5% is expected to be uncollectible.
What are the total cash collections in May?

Accepted Answer

A) $62,600 
B) $20,600 
C) $65,000 
D) $76,100 
A) $62,600 
B) $20,600 
C) $65,000 
D) $76,100

Question 4

Which of the following budgets usually shows separate sections for fixed and variable costs?

Accepted Answer

A) Direct materials and manufacturing overhead budget 
B) Manufacturing overhead budget and production budget 
C) Production budget and manufacturing overhead budget 
D) Operating expense budget and manufacturing overhead budget 
A) Direct materials and manufacturing overhead budget 
B) Manufacturing overhead budget and production budget 
C) Production budget and manufacturing overhead budget 
D) Operating expense budget and manufacturing overhead budget

Question 5

June sales were $6,000 while projected sales for July and August were $8,500 and $7,000, respectively. All credit sales are collected in the month following the sale. Sales are 75% credit and 25% cash. What are the expected collections for July?

Accepted Answer

A) $8,375 
B) $7,875 
C) $7,375 
D) $6,625 
A) $8,375 
B) $7,875 
C) $7,375 
D) $6,625

Question 6

Romona Company expects its November sales to be 20% higher than its October sales of $165,000. All sales are on credit and are collected as follows: 35% in the month of the sale and 60% in the following month. Purchases were $110,000 in October and are expected to be $140,000 in November. Purchases are paid 40% in the month of purchase and 60% in the following month. The cash balance on November 1 is $13,500. The cash balance on November 30 will be

Accepted Answer

A) $46,300. 
B) $59,800. 
C) $2,050. 
D) $32,800. 
A) $46,300. 
B) $59,800. 
C) $2,050. 
D) $32,800.

Question 7

The ________ budget is part of the financial budgets.

Accepted Answer

A) cash 
B) sales 
C) direct materials 
D) operating expense 
A) cash 
B) sales 
C) direct materials 
D) operating expense

Question 8

Loyal Pet Company expects to sell 5,000 beefy dog treats in January and 9,000 in February for $3 each. What will be the total sales revenue reflected in the sales budget for those months?

Accepted Answer

A) January $15,000; February $27,000 
B) January $1,667; February $3,000 
C) January $3,000; February $1,667 
D) January $27,000; February $15,000 
A) January $15,000; February $27,000 
B) January $1,667; February $3,000 
C) January $3,000; February $1,667 
D) January $27,000; February $15,000

Question 9

Mockingbird Company expects to sell 5,200 bird perches in January and 9,500 in February for $3 each. What will be the total sales revenue reflected in the sales budget for those months?

Accepted Answer

A) January $1,733; February $3,167 
B) January $15,600; February $28,500 
C) January $3,167; February $1,733 
D) January $28,500; February $15,600 
A) January $1,733; February $3,167 
B) January $15,600; February $28,500 
C) January $3,167; February $1,733 
D) January $28,500; February $15,600

Question 10

The ________ budget is part of the financial budgets.

Accepted Answer

A) production 
B) budgeted income statement 
C) budgeted balance sheet 
D) sales 
A) production 
B) budgeted income statement 
C) budgeted balance sheet 
D) sales

Question 11

Most companies use ________ when developing the budgets each year.

Accepted Answer

A) a top-down approach 
B) zero-based budgets 
C) slack-based budgets 
D) participative budgeting 
A) a top-down approach 
B) zero-based budgets 
C) slack-based budgets 
D) participative budgeting

Question 12

On the direct labor budget, the total quantity of direct labor hours needed is computed as

Accepted Answer

A) units to be produced × direct labor hour per unit. 
B) quantity needed for production + indirect labor hours - direct labor hours. 
C) units to be produced - indirect labor hours × cost per labor hour. 
D) estimated direct labor hours needed × cost per hour. 
A) units to be produced × direct labor hour per unit. 
B) quantity needed for production + indirect labor hours - direct labor hours. 
C) units to be produced - indirect labor hours × cost per labor hour. 
D) estimated direct labor hours needed × cost per hour.

Question 13

Manufacturing, merchandising, and service companies prepare operating expense budgets.

Accepted Answer

A) True 
 B)False

Question 14

Feeney Furniture prepared the following sales budget:   Credit collections are 15% two months following the sale, 50% in the month following the sale, and 30% in the month of sale. The remaining 5% is expected to be uncollectible.
What is the total cash received in April from April sales?

Accepted Answer

A) $4,800 
B) $39,000 
C) $3,000 
D) $40,800 
A) $4,800 
B) $39,000 
C) $3,000 
D) $40,800

Question 15

Which of the following types of companies use a sales budget?

Accepted Answer

A) Manufacturing 
B) Merchandising 
C) Service 
D) All of the above 
A) Manufacturing 
B) Merchandising 
C) Service 
D) All of the above

Question 16

Frisbee Enterprises produces frisbees. Frisbee Enterprises has the following sales projections for the upcoming year:
   Inventory at the beginning of the year was 6,000 frisbees. Frisbee Enterprises wants to have 30% of the next quarter's sales in units on hand at the end of each quarter. How many frisbees should Frisbee Enterprises produce during the first quarter? Show your calculations.

Accepted Answer

The answer of Frisbee Enterprises produces frisbees. Frisbee Enterprises has...

Question 17

All of the following are shown on the combined cash budget except

Accepted Answer

A) projected cash balance at the end of the month. 
B) projected cash collections and cash payments. 
C) projected borrowings and repayments. 
D) All of the above are shown on the combined cash budget 
A) projected cash balance at the end of the month. 
B) projected cash collections and cash payments. 
C) projected borrowings and repayments. 
D) All of the above are shown on the combined cash budget

Question 18

Sander Enterprises prepared the following sales budget:   The expected gross profit rate is 40% and the inventory at the end of February was $10,000. Desired inventory levels at the end of the month are 20% of the next month's cost of goods sold.
What is the desired beginning inventory on June 1?

Accepted Answer

A) $1,440 
B) $1,680 
C) $1,120 
D) $8,400 
A) $1,440 
B) $1,680 
C) $1,120 
D) $8,400

Question 19

Which of the following alternatives reflects the proper order of preparing components of the master budget? 1. Production budget
2) Sales budget
3) Direct materials budget

Accepted Answer

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

Question 20

At the beginning of the year, Lakeview Corporation has 660 life vests in inventory. The company wants to have 2,100 vests in inventory at the end of the year and plans to sell 6,400 life vests during the year. How many life vests must Lakeview Corporation produce during the year?

Accepted Answer

A) 8,500 
B) 3,640 
C) 7,840 
D) 9,160 
A) 8,500 
B) 3,640 
C) 7,840 
D) 9,160

Which of the following items would be shown on a cash payments budget?

Which of the following is not part of the operating budget?

Two Brothers Moving prepared the following sales budget: Credit collections are 25% in the month of sale, 60% in the month following the sale, and 10% two months following the sale. The remaining 5% is expected to be uncollectible. What are the total cash collections in May?

Which of the following budgets usually shows separate sections for fixed and variable costs?

June sales were $6,000 while projected sales for July and August were $8,500 and $7,000, respectively. All credit sales are collected in the month following the sale. Sales are 75% credit and 25% cash. What are the expected collections for July?

The ________ budget is part of the financial budgets.

Loyal Pet Company expects to sell 5,000 beefy dog treats in January and 9,000 in February for $3 each. What will be the total sales revenue reflected in the sales budget for those months?

Mockingbird Company expects to sell 5,200 bird perches in January and 9,500 in February for $3 each. What will be the total sales revenue reflected in the sales budget for those months?

The ________ budget is part of the financial budgets.

Most companies use ________ when developing the budgets each year.

On the direct labor budget, the total quantity of direct labor hours needed is computed as

Manufacturing, merchandising, and service companies prepare operating expense budgets.

Feeney Furniture prepared the following sales budget: Credit collections are 15% two months following the sale, 50% in the month following the sale, and 30% in the month of sale. The remaining 5% is expected to be uncollectible. What is the total cash received in April from April sales?

Which of the following types of companies use a sales budget?

All of the following are shown on the combined cash budget except

Sander Enterprises prepared the following sales budget: The expected gross profit rate is 40% and the inventory at the end of February was $10,000. Desired inventory levels at the end of the month are 20% of the next month's cost of goods sold. What is the desired beginning inventory on June 1?

Which of the following alternatives reflects the proper order of preparing components of the master budget? 1. Production budget 2) Sales budget 3) Direct materials budget

At the beginning of the year, Lakeview Corporation has 660 life vests in inventory. The company wants to have 2,100 vests in inventory at the end of the year and plans to sell 6,400 life vests during the year. How many life vests must Lakeview Corporation produce during the year?

Introduction to Managerial Accounting

Building Blocks of Managerial Accounting

Job Costing

Activity-Based Costing, Lean Operations, and the Costs of Quality

Process Costing

Cost Behavior

Cost-Volume-Profit Analysis

Relevant Costs for Short-Term Decisions

Performance Evaluation

Standard Costs and Variances

Capital Investment Decisions and the Time Value of Money

Statement of Cash Flows

Financial Statement Analysis

Sustainability

Filters

Exam 9: The Master Budget

Which of the following items would be shown on a cash payments budget?

Which of the following is not part of the operating budget?

Two Brothers Moving prepared the following sales budget: Credit collections are 25% in the month of sale, 60% in the month following the sale, and 10% two months following the sale. The remaining 5% is expected to be uncollectible. What are the total cash collections in May?

Which of the following budgets usually shows separate sections for fixed and variable costs?

June sales were $6,000 while projected sales for July and August were $8,500 and $7,000, respectively. All credit sales are collected in the month following the sale. Sales are 75% credit and 25% cash. What are the expected collections for July?

The ________ budget is part of the financial budgets.

Loyal Pet Company expects to sell 5,000 beefy dog treats in January and 9,000 in February for $3 each. What will be the total sales revenue reflected in the sales budget for those months?

Mockingbird Company expects to sell 5,200 bird perches in January and 9,500 in February for $3 each. What will be the total sales revenue reflected in the sales budget for those months?

The ________ budget is part of the financial budgets.

Most companies use ________ when developing the budgets each year.

On the direct labor budget, the total quantity of direct labor hours needed is computed as

Manufacturing, merchandising, and service companies prepare operating expense budgets.

Feeney Furniture prepared the following sales budget: Credit collections are 15% two months following the sale, 50% in the month following the sale, and 30% in the month of sale. The remaining 5% is expected to be uncollectible. What is the total cash received in April from April sales?

Which of the following types of companies use a sales budget?

All of the following are shown on the combined cash budget except

Sander Enterprises prepared the following sales budget: The expected gross profit rate is 40% and the inventory at the end of February was $10,000. Desired inventory levels at the end of the month are 20% of the next month's cost of goods sold. What is the desired beginning inventory on June 1?

Which of the following alternatives reflects the proper order of preparing components of the master budget? 1. Production budget 2) Sales budget 3) Direct materials budget

At the beginning of the year, Lakeview Corporation has 660 life vests in inventory. The company wants to have 2,100 vests in inventory at the end of the year and plans to sell 6,400 life vests during the year. How many life vests must Lakeview Corporation produce during the year?

Introduction to Managerial Accounting

Building Blocks of Managerial Accounting

Job Costing

Activity-Based Costing, Lean Operations, and the Costs of Quality

Process Costing

Cost Behavior

Cost-Volume-Profit Analysis

Relevant Costs for Short-Term Decisions

Performance Evaluation

Standard Costs and Variances

Capital Investment Decisions and the Time Value of Money

Statement of Cash Flows

Financial Statement Analysis

Sustainability

Filters