Question 1

The first three schedules to complete when preparing the master operating budget are the

Accepted Answer

A) revenue budget,production budget,and direct materials purchases and usage budget. 
B) costs of goods sold budget,production budget,and cash budget. 
C) revenue budget,overhead budget,and production budget. 
D) revenue budget,cash inflows,and production expenditures. 
E) revenue budget,costs of goods sold budget,and production budget. 
A) revenue budget,production budget,and direct materials purchases and usage budget. 
B) costs of goods sold budget,production budget,and cash budget. 
C) revenue budget,overhead budget,and production budget. 
D) revenue budget,cash inflows,and production expenditures. 
E) revenue budget,costs of goods sold budget,and production budget.

Question 2

Manufacturing overhead costs for the budget include

Accepted Answer

A) factory utility costs. 
B) direct materials and supervision. 
C) direct labour and direct materials. 
D) sales supervisors' salaries. 
E) direct labour and indirect labour. 
A) factory utility costs. 
B) direct materials and supervision. 
C) direct labour and direct materials. 
D) sales supervisors' salaries. 
E) direct labour and indirect labour.

Question 3

A budget is a quantitative expression for a set time period of a proposed future plan of action by management.

Accepted Answer

A) True 
 B)False

Question 4

What is budgetary slack?
What are the pros and cons of building slack into the budget from the point of view of (a)an employee and (b)a senior manager?

Accepted Answer

Budgetary slack refers to the practice o

Question 5

Perry Company has gathered the following information:
   
Perry desires to keep a minimum cash balance of $20,000.
Required:
Prepare a cash budget for May,and indicate whether or not Perry meets minimum cash requirements.

Accepted Answer

The answer of Perry Company has gathered the following information:
...

Question 6

Answer the following question(s)using the information below.
The following information pertains to Hepburn Company:
   Cash is collected from customers in the following manner:
- Month of sale 30%
- Month following the sale 70%
40% of purchases are paid for in cash in the month of purchase,and the balance is paid the following month.
Labour costs are 20% of sales.Other operating costs are $30,000 per month (including $8,000 of depreciation).Both of these are paid in the month incurred.The cash balance on March 1 is $8,000.A minimum cash balance of $6,000 is required at the end of the month.Money can be borrowed in multiples of $1,000.
-How much cash will be collected from customers in March?

Accepted Answer

A) $92,000 
B) $90,000 
C) $100,000 
D) $86,000 
E) $66,000 
A) $92,000 
B) $90,000 
C) $100,000 
D) $86,000 
E) $66,000

Question 7

Responsibility accounting focuses on information and knowledge,not control.

Accepted Answer

A) True 
 B)False

Question 8

A limitation of comparing a company's performance against actual results of last year is that

Accepted Answer

A) it includes adjustments for future conditions. 
B) feedback is no longer a possibility. 
C) the benchmark may be unrealistic. 
D) past results can contain inefficiencies of the past year. 
E) the budgeting time period is set at one year. 
A) it includes adjustments for future conditions. 
B) feedback is no longer a possibility. 
C) the benchmark may be unrealistic. 
D) past results can contain inefficiencies of the past year. 
E) the budgeting time period is set at one year.

Question 9

Randy Company has budgeted sales of 12,000 units,target ending finished good inventory of 2,000 units,and a beginning finished goods inventory of 600 units.How many units should be produced?

Accepted Answer

A) 14,600 units 
B) 13,400 units 
C) 10,600 units 
D) 9,400 units 
E) 7,250 units 
A) 14,600 units 
B) 13,400 units 
C) 10,600 units 
D) 9,400 units 
E) 7,250 units

Question 10

Answer the following question(s)using the information below.
The following information pertains to Tiffany Company:
   Cash is collected from customers in the following manner:
- Month of sale 30%
- Month following the sale 70%
40% of purchases are paid for in cash in the month of purchase,and the balance is paid the following month.
Labour costs are 20% of sales.Other operating costs are $15,000 per month (including $4,000 of depreciation).Both of these are paid in the month incurred.The cash balance on March 1 is $4,000.A minimum cash balance of $3,000 is required at the end of the month.Money can be borrowed in multiples of $1,000.
-How much cash will be paid to suppliers in March?

Accepted Answer

A) $23,200 
B) $28,000 
C) $44,000 
D) $24,800 
E) $17,600 
A) $23,200 
B) $28,000 
C) $44,000 
D) $24,800 
E) $17,600

Question 11

Use the information below to answer the following question(s).
Fair Score Company manufactures scoreboards for athletic events.It expects to sell 20,000 scoreboards in 2015.The company has enough beginning inventory of direct materials to produce 8,000 units.Beginning work-in-process inventory totals 2,000 units and is 100 percent complete as to material and 50 percent complete as to labour and overhead.Beginning finished units total 4,000 with a target ending finished inventory of 3,000 units.The scoreboards sell for $800.There is no ending work-in-process inventory.Direct materials costs for each scoreboard total $200 while direct labour is $80.Manufacturing overhead is $60 per scoreboard.
-What will be the Fair Score Company budgeted amount of cost of goods sold?

Accepted Answer

A) $8,160,000 
B) $6,800,000 
C) $6,460,000 
D) $6,120,000 
E) $5,975,000 
A) $8,160,000 
B) $6,800,000 
C) $6,460,000 
D) $6,120,000 
E) $5,975,000

Question 12

How is budgeting for a multinational corporation different than budgeting for a corporation that is strictly domestic?

Accepted Answer

Budgeting for a multinational corporatio

Question 13

In going from the sales budget to the production budget,adjustments need to be made for

Accepted Answer

A) finished goods inventories. 
B) overhead charges. 
C) direct materials inventories. 
D) sales returns and allowances. 
E) changing from revenue to costs. 
A) finished goods inventories. 
B) overhead charges. 
C) direct materials inventories. 
D) sales returns and allowances. 
E) changing from revenue to costs.

Question 14

Benchmarks encourage the setting of stretch goals.

Accepted Answer

A) True 
 B)False

Question 15

Describe the benefits to an organization of preparing an operating budget.

Accepted Answer

A well-prepared operating budget should

Question 16

It is best to compare this year's performance with last year's actual performance rather than this year's budget.

Accepted Answer

A) True 
 B)False

Question 17

Use the information below to answer the following question(s).
Copper Corporation has the following sales budget for the last six months of 2016:
   Historically,the cash collection of sales has been as follows:
65 percent of sales collected in month of sale,
25 percent of sales collected in month following sale,
8 percent of sales collected in second month following sale,and
2 percent of sales is uncollectable.
-What is the ending balance of accounts receivable at the end of September assuming uncollectible balance is written off in the third month after the sale?

Accepted Answer

A) $199,000 
B) $97,000 
C) $89,800 
D) $93,000 
E) $88,000 
A) $199,000 
B) $97,000 
C) $89,800 
D) $93,000 
E) $88,000

Question 18

Cash receipts depend on collections of accounts payable,cash sales,and miscellaneous sources,such as rental income.

Accepted Answer

A) True 
 B)False

Question 19

Tripp Company sells three products with the following seasonal sales pattern:
   
The annual sales budget shows forecasts for the different products and their expected selling price per unit as follows:
   
Required:
Prepare a revenue budget in dollars for each quarter.Present each quarter in a separate column and add a column to show total year sales.

Accepted Answer

The answer of Tripp Company sells three products with the...

Question 20

Long-run planning (strategic plans)involves the preparation of the

Accepted Answer

A) operating budget. 
B) cash budget. 
C) budget standards. 
D) profit plan. 
E) capital budget. 
A) operating budget. 
B) cash budget. 
C) budget standards. 
D) profit plan. 
E) capital budget.

The first three schedules to complete when preparing the master operating budget are the

Manufacturing overhead costs for the budget include

A budget is a quantitative expression for a set time period of a proposed future plan of action by management.

What is budgetary slack? What are the pros and cons of building slack into the budget from the point of view of (a)an employee and (b)a senior manager?

Perry Company has gathered the following information: Perry desires to keep a minimum cash balance of $20,000. Required: Prepare a cash budget for May,and indicate whether or not Perry meets minimum cash requirements.

Responsibility accounting focuses on information and knowledge,not control.

A limitation of comparing a company's performance against actual results of last year is that

Randy Company has budgeted sales of 12,000 units,target ending finished good inventory of 2,000 units,and a beginning finished goods inventory of 600 units.How many units should be produced?

How is budgeting for a multinational corporation different than budgeting for a corporation that is strictly domestic?

In going from the sales budget to the production budget,adjustments need to be made for

Benchmarks encourage the setting of stretch goals.

Describe the benefits to an organization of preparing an operating budget.

It is best to compare this year's performance with last year's actual performance rather than this year's budget.

Cash receipts depend on collections of accounts payable,cash sales,and miscellaneous sources,such as rental income.

Long-run planning (strategic plans)involves the preparation of the

The Accountants Vital Role in Decision Making

An Introduction to Cost Terms and Purposes

Cost-Volume-Profit Analysis

Job Costing

Activity-Based Costing and Management

Flexible Budgets,variances,and Management Control: I

Flexible Budgets,variances,and Management Control: II

Income Effects of Denominator Level on Inventory Valuation

Analysis of Cost Behaviour

Decision Making and Relevant Information

Pricing Decisions, product Profitability Decisions, and Cost Management

Strategy,balanced Scorecard,and Profitability Analysis

Period Cost Allocation

Cost Allocation: Joint Products and Byproducts

Revenue and Customer Profitability Analysis

Process Costing

Spoilage, rework, and Scrap

Inventory Cost Management Strategies

Capital Budgeting: Methods of Investment Analysis

Transfer Pricing and Multinational Management Control Systems

Multinational Performance Measurement and Compensation

Filters

Exam 6: Master Budget and Responsibility Accounting

The first three schedules to complete when preparing the master operating budget are the

Manufacturing overhead costs for the budget include

A budget is a quantitative expression for a set time period of a proposed future plan of action by management.

What is budgetary slack? What are the pros and cons of building slack into the budget from the point of view of (a)an employee and (b)a senior manager?

Perry Company has gathered the following information: Perry desires to keep a minimum cash balance of $20,000. Required: Prepare a cash budget for May,and indicate whether or not Perry meets minimum cash requirements.

Responsibility accounting focuses on information and knowledge,not control.

A limitation of comparing a company's performance against actual results of last year is that

Randy Company has budgeted sales of 12,000 units,target ending finished good inventory of 2,000 units,and a beginning finished goods inventory of 600 units.How many units should be produced?

How is budgeting for a multinational corporation different than budgeting for a corporation that is strictly domestic?

In going from the sales budget to the production budget,adjustments need to be made for

Benchmarks encourage the setting of stretch goals.

Describe the benefits to an organization of preparing an operating budget.

It is best to compare this year's performance with last year's actual performance rather than this year's budget.

Cash receipts depend on collections of accounts payable,cash sales,and miscellaneous sources,such as rental income.

Long-run planning (strategic plans)involves the preparation of the

The Accountants Vital Role in Decision Making

An Introduction to Cost Terms and Purposes

Cost-Volume-Profit Analysis

Job Costing

Activity-Based Costing and Management

Flexible Budgets,variances,and Management Control: I

Flexible Budgets,variances,and Management Control: II

Income Effects of Denominator Level on Inventory Valuation

Analysis of Cost Behaviour

Decision Making and Relevant Information

Pricing Decisions, product Profitability Decisions, and Cost Management

Strategy,balanced Scorecard,and Profitability Analysis

Period Cost Allocation

Cost Allocation: Joint Products and Byproducts

Revenue and Customer Profitability Analysis

Process Costing

Spoilage, rework, and Scrap

Inventory Cost Management Strategies

Capital Budgeting: Methods of Investment Analysis

Transfer Pricing and Multinational Management Control Systems

Multinational Performance Measurement and Compensation

Filters