Question 1

Which of the following is not true?

Accepted Answer

A)  The sales forecast is done before the sales budget. 
B)  The master budget is the comprehensive plan for the organization as a whole. 
C)  The production budget is prepared in units and dollars. 
D)  One approach to forecasting sales is the bottom-up approach. 
E)  In creating the sales forecast, outside factors such as the state of the economy, should be considered. 
A)  The sales forecast is done before the sales budget. 
B)  The master budget is the comprehensive plan for the organization as a whole. 
C)  The production budget is prepared in units and dollars. 
D)  One approach to forecasting sales is the bottom-up approach. 
E)  In creating the sales forecast, outside factors such as the state of the economy, should be considered.

Question 2

Identify each item as either part of the operating budget or the financial budget.
-budgeted balance sheet

Accepted Answer

A) Operating Budget 
B) Financial Budget 
A) Operating Budget 
B) Financial Budget

Question 3

$\begin{array}{lr}
\text {Percent paid in the month of sale  }&25\%\
\text {Percent paid in the month after the sale }&64\%\
\text { Percent paid in the second month after the sale}&5\%\
\end{array}$
 Toscano provided information on sales as follows:
 $\begin{array}{ll}
\text { May } & \$ 140,000 \
\text { June } & \$ 115,000 \
\text { July } & \$ 126,000 \
\text { August (expected) } & \$ 132,000
\end{array}$
-Refer to Figure 9-6. How much of June credit sales are expected to be collected in the month of July?

Accepted Answer

A)  $30,000 
B)  $60,000 
C)  $36,000 
D)  $73,600 
E)  $80,000 
A)  $30,000 
B)  $60,000 
C)  $36,000 
D)  $73,600 
E)  $80,000

Question 4

Looking backward to determine what actually happened and comparing it with the previously planned outcomes is

Accepted Answer

A)  control. 
B)  communicating. 
C)  decision making. 
D)  strategic planning. 
E)  budgeting. 
A)  control. 
B)  communicating. 
C)  decision making. 
D)  strategic planning. 
E)  budgeting.

Question 5

Which of the following budgets can be used for control?

Accepted Answer

A)  Production budget 
B)  Cash budget 
C)  Budgeted income statement 
D)  Selling and administrative expense budget 
E)  All of these 
A)  Production budget 
B)  Cash budget 
C)  Budgeted income statement 
D)  Selling and administrative expense budget 
E)  All of these

Question 6

When top management assumes total control of the budgeting process and only seeks superficial participation from lower-level managers this is known as ________________.

Accepted Answer

The answer of When top management assumes total control of...

Question 7

The department manager reviews the budget, provides policy guidelines and budgetary goals, and resolves differences that arise as the budget is prepared, approves the final budget, and monitors the actual performance of the organization as the year unfolds.

Accepted Answer

A) True 
 B)False

Question 8

A continuous budget is a moving 12-month budget.

Accepted Answer

A) True 
 B)False

Question 9

Does a not-for-profit agency need to budget? Why or why not?

Accepted Answer

All entities need to use the formal budg

Question 10

The first budget to be prepared is the sales budget.

Accepted Answer

A) True 
 B)False

Question 11

A company anticipates selling $200,000 of goods, of which $15,000 will probably be uncollectible. Which of the following statements is true?

Accepted Answer

A)  $15,000 does not appear on the cash budget. 
B)  $215,000 is added to the cash budget. 
C)  $15,000 is subtracted from the cash budget. 
D)  $185,000 appears as a disbursement on the cash budget. 
E)  None of these. 
A)  $15,000 does not appear on the cash budget. 
B)  $215,000 is added to the cash budget. 
C)  $15,000 is subtracted from the cash budget. 
D)  $185,000 appears as a disbursement on the cash budget. 
E)  None of these.

Question 12

You have decided to throw a party next weekend for 19 friends. The friends are going to bring health food, so all you have to have available are the drinks. You estimate that, on average, each person will drink four bottles of soft drinks. Three of your friends will drink only natural soda without unneeded color - so Sulo Ginger Ale should work well for them. For the others and yourself, you decide to buy Sulo Cola. Before going online, you check the refrigerator - you already have six bottles of Sulo Ginger Ale and 14 of Sulo Cola. Since this is the end of the semester - you decide that you don't really want any of the soft drinks on hand after the party. Now, you are ordering on the Internet.

Accepted Answer

The answer of You have decided to throw a party...

Question 13

Abrams Bottling Company sells fruit-flavored colas. Estimated sales in cartons for May, June, and July are 1,000, 3,000 and 5,000 respectively. The price is forecast at $5 per carton. Abrams requires that finished goods ending inventory be 20% of the next month's sales. Inventory was 500 units on May 1. Each carton requires 12 oz of fruit syrup and 130 oz of carbonated water. Materials ending inventory is 10% of the next month's production needs. May 1 inventory met that requirement.

Accepted Answer

The answer of Abrams Bottling Company sells fruit-flavored colas. Estimated...

Question 14

Which budget is the first one that must be completed in the master budgeting process and why?

Accepted Answer

The sales budget is the first budget to

Question 15

CutMaster Salons anticipates giving 100 permanents in May, 130 in June, and 120 in July. CutMaster needs one permanent wave kit for each perm, along with two boxes of wave tissues. Its inventory policy is to have 10% of the following month's materials needs on hand. On May 1, there were 15 wave kits and four boxes of wave tissues on hand. (Round any fractions of a unit to the nearest whole unit.)

Accepted Answer

The answer of CutMaster Salons anticipates giving 100 permanents in...

Question 16

The direct materials purchases budget is based on the sales budget.

Accepted Answer

A) True 
 B)False

Question 17

Belant Company budgeted 200,000 units of production for June, 210,000 units for July and 300,000 units for August. Each unit requires 0.25 direct labor hours. How many direct labor hours are budgeted for August?

Accepted Answer

A)  50,000 
B)  5,000 
C)  75,000 
D)  52,500 
E)  300,000 
A)  50,000 
B)  5,000 
C)  75,000 
D)  52,500 
E)  300,000

Question 18

The selling and administrative expenses budget includes

Accepted Answer

A)  cost of goods sold. 
B)  overhead. 
C)  fixed production expense. 
D)  variable cost of selling. 
E)  all of these. 
A)  cost of goods sold. 
B)  overhead. 
C)  fixed production expense. 
D)  variable cost of selling. 
E)  all of these.

Question 19

Rapid-Lube provides oil changes and lubes. The estimated number of oil changes for April and May are 3,600 and 4,000. Each oil change takes 12 minutes of direct labor. The wage rate is $10 per hour. Overhead is $3,700 per month and $2 per oil change.

Accepted Answer

The answer of Rapid-Lube provides oil changes and lubes. The...

Question 20

Which of the following is a use of budgets for control?

Accepted Answer

A)  Plans can be made for the future. 
B)  If conditions change between the formation of the budget and the current time, budgets can be quickly adapted. 
C)  Budgets set a standard against which results can be compared. 
D)  Communication is improved. 
E)  All of these. 
A)  Plans can be made for the future. 
B)  If conditions change between the formation of the budget and the current time, budgets can be quickly adapted. 
C)  Budgets set a standard against which results can be compared. 
D)  Communication is improved. 
E)  All of these.

Which of the following is not true?

Identify each item as either part of the operating budget or the financial budget. -budgeted balance sheet

Looking backward to determine what actually happened and comparing it with the previously planned outcomes is

Which of the following budgets can be used for control?

When top management assumes total control of the budgeting process and only seeks superficial participation from lower-level managers this is known as ________________.

The department manager reviews the budget, provides policy guidelines and budgetary goals, and resolves differences that arise as the budget is prepared, approves the final budget, and monitors the actual performance of the organization as the year unfolds.

A continuous budget is a moving 12-month budget.

Does a not-for-profit agency need to budget? Why or why not?

The first budget to be prepared is the sales budget.

A company anticipates selling $200,000 of goods, of which $15,000 will probably be uncollectible. Which of the following statements is true?

Which budget is the first one that must be completed in the master budgeting process and why?

The direct materials purchases budget is based on the sales budget.

Belant Company budgeted 200,000 units of production for June, 210,000 units for July and 300,000 units for August. Each unit requires 0.25 direct labor hours. How many direct labor hours are budgeted for August?

The selling and administrative expenses budget includes

Rapid-Lube provides oil changes and lubes. The estimated number of oil changes for April and May are 3,600 and 4,000. Each oil change takes 12 minutes of direct labor. The wage rate is $10 per hour. Overhead is $3,700 per month and $2 per oil change.

Which of the following is a use of budgets for control?

Introduction to Managerial Accounting

Basic Managerial Accounting Concepts

Cost Behavior

Cost-Volume-Profit Analysis: a Managerial Planning Tool

Job-Order Costing

Process Costing

Activity-Based Costing and Management

Absorption and Variable Costing, and Inventory Management

Standard Costing: a Managerial Control Tool

Flexible Budgets and Overhead Analysis

Performance Evaluation and Decentralization

Short-Run Decision Making: Relevant Costing

Capital Investment Decisions

Statement of Cash Flows

Financial Statement Analysis

Filters

Exam 9: Profit Planning

Which of the following is not true?

Identify each item as either part of the operating budget or the financial budget. -budgeted balance sheet

Looking backward to determine what actually happened and comparing it with the previously planned outcomes is

Which of the following budgets can be used for control?

When top management assumes total control of the budgeting process and only seeks superficial participation from lower-level managers this is known as ________________.

The department manager reviews the budget, provides policy guidelines and budgetary goals, and resolves differences that arise as the budget is prepared, approves the final budget, and monitors the actual performance of the organization as the year unfolds.

A continuous budget is a moving 12-month budget.

Does a not-for-profit agency need to budget? Why or why not?

The first budget to be prepared is the sales budget.

A company anticipates selling $200,000 of goods, of which $15,000 will probably be uncollectible. Which of the following statements is true?

Which budget is the first one that must be completed in the master budgeting process and why?

The direct materials purchases budget is based on the sales budget.

Belant Company budgeted 200,000 units of production for June, 210,000 units for July and 300,000 units for August. Each unit requires 0.25 direct labor hours. How many direct labor hours are budgeted for August?

The selling and administrative expenses budget includes

Rapid-Lube provides oil changes and lubes. The estimated number of oil changes for April and May are 3,600 and 4,000. Each oil change takes 12 minutes of direct labor. The wage rate is $10 per hour. Overhead is $3,700 per month and $2 per oil change.

Which of the following is a use of budgets for control?

Introduction to Managerial Accounting

Basic Managerial Accounting Concepts

Cost Behavior

Cost-Volume-Profit Analysis: a Managerial Planning Tool

Job-Order Costing

Process Costing

Activity-Based Costing and Management

Absorption and Variable Costing, and Inventory Management

Standard Costing: a Managerial Control Tool

Flexible Budgets and Overhead Analysis

Performance Evaluation and Decentralization

Short-Run Decision Making: Relevant Costing

Capital Investment Decisions

Statement of Cash Flows

Financial Statement Analysis

Filters