Exam 9: The Master Budget

At the beginning of the year,Patio Living Corporation has 550 planters in inventory.The company plans to sell 5,200 planters during the year and wants to have 1,200 planters in inventory at the end of the year.How many planters must Patio Living Corporation produce during the year?

Merchandising companies prepare sales,cash,and operating expenses budgets.

In which of the following company types does the manager use a capital expenditures budget?

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

Most companies use ________ when the managers develop budgets each year.

Flawless Lawns Manufacturing produces lawn edger's.The company has a policy that the ending inventory in any month must be 10% of the following month's expected sales.On March 31,Flawless Lawns Manufacturing had 140 lawn edger's in inventory.Flawless Lawns Manufacturing expects to sell the following number of lawn edger's in each of the next four months: Required: Prepare a production budget for the second quarter,with a column for each month and for the quarter.

The ________ budget starts with the number of units to be produced.

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

In which of the following company types does a manager use a sales budget?

Budgets are used to accomplish all of the following tasks,except

Bruner Stores wants to have 500 shovels in ending inventory on December 31.Budgeted sales for December are 1,950 shovels.The November 30 inventory was 320 shovels.How many shovels should Benson Stores purchase for December?

Brockman Company is preparing its cash budget for the upcoming month.The budgeted beginning cash balance is expected to be $35,000.Budgeted cash disbursements are $123,000,while budgeted cash receipts are $130,000.Brockman Company wants to have an ending cash balance of $48,000.How much would Brockman Company need to borrow to achieve its desired ending cash balance?

Russell Company expects cash sales for July of $15,000,and a 22% monthly increase during August and September.Credit sales of $6,000 in July should be followed by 15% decreases during August and September.What are budgeted cash sales and budgeted credit sales for September?

The master budget includes both the operating budgets and the financial budgets.

The manager at a service company does not prepare a cash budget.

A company sells goods and offers credit terms of "net 30 days." What does this reveal to the company that sold the goods?

Goliath Company prepared the following purchases budget: All purchases are paid for as follows: 30% in the month of purchase,45% in the following month,and 25% two months after purchase. What are the cash disbursements in October to account for the September purchases at Goliath Company?

Mighty Corporation manufactures end tables.Each end table requires .50 direct labor hours in its production.Mighty Corporation has a direct labor rate of $15 per direct labor hour.The production budget shows that Mighty Corporation plans to produce 1,000 end tables in March and 1,100 end tables in April.What is the total combined direct labor cost that Mighty Corporation should budget in March and April?

Eastern Corporation collects 10% in the second month following sale,55% in the month following sale and 35% of a month's sales in the month of sale.Budgeted sales for the upcoming four months are: The amount of cash that will be collected in July is budgeted to be

Crafty Carpentry Company produces and sells a shelf for $25 each.The beginning inventory is 2,000 shelves,and the desired ending inventory is 2,200 shelves.If budgeted production is 12,500 shelves,what is the forecasted sales revenue from the shelves?