Question 1

A company has prepared the operating budget and the cash budget and is now preparing the budgeted balance sheet. The balance of Inventory can be taken from:

Accepted Answer

A) production budget and cost of goods sold budget. 
B) the financial budget. 
C) the cash budget. 
D) the selling and administrative expenses budget. 
A) production budget and cost of goods sold budget. 
B) the financial budget. 
C) the cash budget. 
D) the selling and administrative expenses budget.

Question 2

Chaterlain Company is preparing its budget for the 3rd quarter. Cash balance on July 31 was $30,000. Assume there is no minimum balance of cash required and no borrowing is undertaken. Additional budgeted data is provided here:   Calculate the balance of cash at the end of August.

Accepted Answer

A) $19,100 
B) $28,800 
C) $29,050 
D) $32,000 
A) $19,100 
B) $28,800 
C) $29,050 
D) $32,000

Question 3

The capital expenditures budget represents the company's plan for purchasing the long-term assets.

Accepted Answer

A) True 
 B)False

Question 4

A3+ has prepared its 3rd quarter budget and provided the following data:   The cash balance on June 30 is projected to be $4,000. The company has to maintain a minimum cash balance of $5,000 and is authorized to borrow at the end of each month to make up any shortfalls. It may borrow in increments of $5,000 and has to pay interest every month at an annual rate of 5%. All financing transactions are assumed to take place at the end of the month. The loan balance should be repaid in increments of $5,000 whenever there is surplus cash. Calculate the amount of principal repayment at the end of September.

Accepted Answer

A) $5,000 
B) $10,000 
C) $15,000 
D) $20,000 
A) $5,000 
B) $10,000 
C) $15,000 
D) $20,000

Question 5

While preparing the budgeted balance sheet of a merchandiser, the amount of merchandise inventory can be obtained from:

Accepted Answer

A) the merchandise inventory account. 
B) the inventory, purchases and cost of goods sold budget. 
C) the production budget 
D) the capital expenditure budget and cash budget. 
A) the merchandise inventory account. 
B) the inventory, purchases and cost of goods sold budget. 
C) the production budget 
D) the capital expenditure budget and cash budget.

Question 6

From the following details provided by NutShell Inc., prepare the cost of goods sold budget for the year 2015.     Assume that Nutshell Inc. has no closing stock at the end of each month.

Accepted Answer

The answer of From the following details provided by NutShell...

Question 7

Kapital Inc. has prepared the operating budget for the first quarter of 2015. They forecast sales of $50,000 in January, $60,000 in February, and $70,000 in March. Variable and fixed expenses are as follows: Variable: Power cost (40% of Sales)
Miscellaneous expenses: (5% of Sales)
Fixed: Salary expense: $8,000 per month
Rent expense: $5,000 per month
Depreciation expense: $1,200 per month
Power cost/fixed portion: $800 per month
Miscellaneous expenses/fixed portion: $1,000 per month
Calculate total selling and administrative expenses for the month of January.

Accepted Answer

A) $38,500 
B) $47,500 
C) $41,700 
D) $43,000 
A) $38,500 
B) $47,500 
C) $41,700 
D) $43,000

Question 8

The starting point in the budgeting process is the preparation of the:

Accepted Answer

A) cash budget. 
B) production budget. 
C) sales budget. 
D) budgeted income statement. 
A) cash budget. 
B) production budget. 
C) sales budget. 
D) budgeted income statement.

Question 9

When a company is preparing a budgeted statement of cash flows, the payments to suppliers for purchases of inventory can be obtained from:

Accepted Answer

A) the cash budget. 
B) the sales budget. 
C) budgeted cash collections. 
D) the budgeted balance sheet. 
A) the cash budget. 
B) the sales budget. 
C) budgeted cash collections. 
D) the budgeted balance sheet.

Question 10

A static budget is a financial plan for a particular level of sales volume.

Accepted Answer

A) True 
 B)False

Question 11

Gamma Corp. has prepared a preliminary cash budget for the 3rd quarter as shown below:   Subsequently, the marketing department revised its figures for cash collections. New data are as follows: $52,000 in July, $50,000 in August, and $42,000 in September. Based on the new data, calculate the new projected cash balance at the end of September.

Accepted Answer

A) $8,500 
B) $2,400 
C) $7,000 
D) $900 
A) $8,500 
B) $2,400 
C) $7,000 
D) $900

Question 12

Chaterlain Company is preparing its budget for the 3rd quarter. The cash balance on June 30 was $30,000. Additional budgeted data is provided here:   What amount should be shown in the cash budget for the cash balance at the end of July?

Accepted Answer

A) $19,100 
B) $30,000 
C) $29,050 
D) $42,200 
A) $19,100 
B) $30,000 
C) $29,050 
D) $42,200

Question 13

Search Engine Corp. has provided the following details concerning budgeted sales.
Budgeted Sales   The collection policy of the company is to collect 20% in the month of sale, 40% in the following month, and remaining 40% in the second month after the month of sale. All sales are made on account.
Calculate the cash receipts from customers for the first six months.

Accepted Answer

Calculation of cash

Question 14

Delleate Inc. has prepared the following purchases budget:   All purchases are paid for as follows: 10% in the month of purchase, 50% in the following month, and 40% two months after purchase. Calculate balance of Accounts payable at the end of October.

Accepted Answer

A) $77,680 
B) $91,760 
C) $69,330 
D) $74,290 
A) $77,680 
B) $91,760 
C) $69,330 
D) $74,290

Question 15

The budgeted production of Gunix Inc. is 8,000 units. Each unit requires 40 minutes of direct labor work to complete. The direct labor rate is $100 per hour. Calculate the budgeted cost of direct labor for the month.

Accepted Answer

A) $533,333.33 
B) $500,000.00 
C) $566,666.66 
D) $633,333.33 
A) $533,333.33 
B) $500,000.00 
C) $566,666.66 
D) $633,333.33

Question 16

Which of the following is true of the sales budget?

Accepted Answer

A) It provides sales values that are used to prepare financial statements for external reporting purposes. 
B) It captures the variable and fixed expenses of the business. 
C) It is used in the production budget. 
D) It shows the value of expected production in a period. 
A) It provides sales values that are used to prepare financial statements for external reporting purposes. 
B) It captures the variable and fixed expenses of the business. 
C) It is used in the production budget. 
D) It shows the value of expected production in a period.

Question 17

Freighters Inc. has the following budgeted figures:   Calculate cost of goods sold for the month of February.

Accepted Answer

A) $40,250 
B) $52,000 
C) $33,750 
D) $39,000 
A) $40,250 
B) $52,000 
C) $33,750 
D) $39,000

Question 18

Developing a budget reduces coordination and communication at different levels in an organization.

Accepted Answer

A) True 
 B)False

Question 19

A company has prepared the operating budget and the cash budget and is now preparing the budgeted balance sheet. While doing so, the cash balance can be taken from:

Accepted Answer

A) the operational budget. 
B) the budgeted income statement. 
C) the cash budget. 
D) the sales budget. 
A) the operational budget. 
B) the budgeted income statement. 
C) the cash budget. 
D) the sales budget.

Question 20

After comparing budgets with actual results, corrective action will be taken based on the differences.

Accepted Answer

A) True 
 B)False

Exam 22: Master Budgets

A company has prepared the operating budget and the cash budget and is now preparing the budgeted balance sheet. The balance of Inventory can be taken from:

Chaterlain Company is preparing its budget for the 3rd quarter. Cash balance on July 31 was $30,000. Assume there is no minimum balance of cash required and no borrowing is undertaken. Additional budgeted data is provided here: Calculate the balance of cash at the end of August.

The capital expenditures budget represents the company's plan for purchasing the long-term assets.

While preparing the budgeted balance sheet of a merchandiser, the amount of merchandise inventory can be obtained from:

From the following details provided by NutShell Inc., prepare the cost of goods sold budget for the year 2015. Assume that Nutshell Inc. has no closing stock at the end of each month.

The starting point in the budgeting process is the preparation of the:

When a company is preparing a budgeted statement of cash flows, the payments to suppliers for purchases of inventory can be obtained from:

A static budget is a financial plan for a particular level of sales volume.

Chaterlain Company is preparing its budget for the 3rd quarter. The cash balance on June 30 was $30,000. Additional budgeted data is provided here: What amount should be shown in the cash budget for the cash balance at the end of July?

Delleate Inc. has prepared the following purchases budget: All purchases are paid for as follows: 10% in the month of purchase, 50% in the following month, and 40% two months after purchase. Calculate balance of Accounts payable at the end of October.

The budgeted production of Gunix Inc. is 8,000 units. Each unit requires 40 minutes of direct labor work to complete. The direct labor rate is $100 per hour. Calculate the budgeted cost of direct labor for the month.

Which of the following is true of the sales budget?

Freighters Inc. has the following budgeted figures: Calculate cost of goods sold for the month of February.

Developing a budget reduces coordination and communication at different levels in an organization.

A company has prepared the operating budget and the cash budget and is now preparing the budgeted balance sheet. While doing so, the cash balance can be taken from:

After comparing budgets with actual results, corrective action will be taken based on the differences.

Accounting and the Business Environment

Recording Business Transactions

The Adjusting Process

Completing the Accounting Cycle

Merchandising Operations

Merchandise Inventory

Accounting Information Systems

Internal Control and Cash

Receivables

Plant Assets, Natural Resources, and Intangibles

Current Liabilities and Payroll

Partnerships

Corporations

Long-Term Liabilities

Investments

The Statement of Cash Flows

Financial Statement Analysis

Introduction to Managerial Accounting

Job Order Costing

Process Costing

Cost-Volume-Profit Analysis

Flexible Budgets and Standard Cost Systems

Cost Allocation and Responsibility Accounting

Short-Term Business Decisions

Capital Investment Decisions

Filters

Chaterlain Company is preparing its budget for the 3^rd quarter. Cash balance on July 31 was $30,000. Assume there is no minimum balance of cash required and no borrowing is undertaken. Additional budgeted data is provided here: Calculate the balance of cash at the end of August.

Chaterlain Company is preparing its budget for the 3^rd quarter. The cash balance on June 30 was $30,000. Additional budgeted data is provided here: What amount should be shown in the cash budget for the cash balance at the end of July?