Exam 12: Master Budget and Responsibility Accounting

Managers at multinational companies that use different currencies must translate their operating performance into a single currency for reporting results to their shareholders each quarter.

The Bay Manufacturing Company expects to sell 25,000 pens at $26 each.The direct material costs are $5 and direct manufacturing labor is $9,and manufacturing overhead is $1.80 per pen.The following inventory levels apply to 2012: On the 2013 budgeted income statement,what amount will be reported for sales? How many pencils need to be produced in 2013? Compute the amount of cost of goods sold on the 2013 budgeted income statement.

The higher and more accurate the budgeted profit forecasts of division managers,the higher their incentive bonuses.

Which of the following is not a way that managers use budgeting tools within ERP systems?

What types of risk do managers identify when they implement sensitivity analysis?

Which of the following is not a manufacturing overhead cost?

The budget costs at companies are different for variable and fixed overhead costs.

How do relative performance measures take out the effects of favorable or unfavorable business conditions that are outside the manager's control?

The only new information managers need to prepare in the production budget is the level of finished goods inventory the company wants to maintain.

The sales manager for the Tool Box,a fine and large tool and machinery outlet,wants to increase the company's operating profit margin from 20% to 30%.The operating income of the company is $180,000. Required Compute the amount of sales revenue needed to achieve the goal?

Which of the following terms is used to describe an income statement and its supporting budget schedules?

________ explicitly incorporates continuous improvement anticipated during the budget period into the budget numbers.

How do sales managers and sales representatives build the revenue budget?

How can performance reports for responsibility centers change manager's behavior?

A responsibility center can be structured to promote better alignment of individual and company goals.

What are the benefits to managers that use budgets?

Managers use budgets to help the organization to learn and adapt plans in response to changed circumstances rather than to evaluate performance.

Which of the following is not an example of cash?

Which of the following is not true about the administration of budgets?

________ is an arrangement of lines of responsibility within an organization.