Question 1

Mountain Express,a clothing boutique chain has an operating income of $240,000.The sales revenue of the company was calculated to be $960,000.
Required
Compute the operating profit margin.

Accepted Answer

A) 32% 
B) 25% 
C) 17% 
D) 46% 
E) 12%

Question 2

What are some things that managers focus on as they prepare budgets?

Accepted Answer

The answer of What are some things that managers focus...

Question 3

After a manager determines the sales budget,a management accountant prepares a ________ that serves as an input for the preparation of the cash budget.

Accepted Answer

A) sales budget 
B) cash budget 
C) operating budget 
D) schedule of cash payments 
E) schedule of cash collections

Question 4

Pressure from performance embedded in stretch targets permit employees to engage in illegal and unethical practices when working in other countries.

Accepted Answer

A) True 
 B)False

Question 5

How do managers treat fixed overhead costs in the budget process?

Accepted Answer

The answer of How do managers treat fixed overhead costs...

Question 6

Some companies refer to budgeting as targeting and other companies refer to budgets as profit plans.

Accepted Answer

A) True 
 B)False

Question 7

Which of the following is not true about budgeting in multinational companies?

Accepted Answer

A) Managers reduce the possible negative impact on performance caused by unfavorable exchange rate movements. 
B) Managers need to understand the political,legal,and economic movements in the different countries that engage in corporate operations. 
C) Countries that have high annual inflation rates have sharp declines in the value of the currency. 
D) The purpose of budgeting in multinational companies is 
E) Managers do not need to consider differences in tax regimes because the company transfers goods and services across the many countries in which it operates.

Question 8

Microsoft refers to goals as ________ and distributes firm-level goals across the company,connecting them to organizational,team,and individual commitments.

Accepted Answer

A) constraint 
B) confinements 
C) commitments 
D) apprehensions 
E) accommodation

Question 9

A manager that works at a company that is evaluated as a profit center will more likely consider rush orders important because they impact sales.

Accepted Answer

A) True 
 B)False

Question 10

What is the impact of budgeting on employee performance?

Accepted Answer

The answer of What is the impact of budgeting on...

Question 11

To avoid problems of budgetary slack,some companies use budgets primarily to plan and other companies use it to a lesser extent in performance evaluations.

Accepted Answer

A) True 
 B)False

Question 12

How do managers react to budgets that challenge the manager?

Accepted Answer

The answer of How do managers react to budgets that...

Question 13

The most frequent budget period is one year.

Accepted Answer

A) True 
 B)False

Question 14

Budgets enable a company's managers to measure actual performance against predicted performance.

Accepted Answer

A) True 
 B)False

Question 15

What is the concept of the bottom-up perspective of budgeting?

Accepted Answer

The answer of What is the concept of the bottom-up...

Question 16

What is a bill of materials? Why do managers use it?

Accepted Answer

The answer of What is a bill of materials? Why...

Question 17

What should managers do if they use sensitivity analysis and they detect small declines in operating income? What could happen if direct material prices increase by 6% and the selling prices decline in the next year?

Accepted Answer

The answer of What should managers do if they use...

Question 18

Which of the following is not true about ERP systems?

Accepted Answer

A) Managers can identify sales quantities for different products. 
B) Managers can use the software to compute the budgeted manufacturing costs of products. 
C) Managers can use ERP to help them budget nonmanufacturing costs in the organization. 
D) Managers can use ERP systems to store vast quantities of information about materials. 
E) Managers are unable to use ERP systems to compute nonmanufacturing costs.

Question 19

Estimates suggest that senior managers spend about ________ of their time on budgeting;and,finance planning departments spend as much as ________ on budgeting.

Accepted Answer

A) 0% - 5%;5% 
B) 5% - 10%;10% 
C) 8% - 15%;30% 
D) 10% - 20%;50% 
E) 15% - 25%;75%

Question 20

The beginning cash balance minus cash receipts equal the total cash available for needs before any financing.

Accepted Answer

A) True 
 B)False

Exam 12: Master Budget and Responsibility Accounting

Mountain Express,a clothing boutique chain has an operating income of $240,000.The sales revenue of the company was calculated to be $960,000. Required Compute the operating profit margin.

What are some things that managers focus on as they prepare budgets?

After a manager determines the sales budget,a management accountant prepares a ________ that serves as an input for the preparation of the cash budget.

Pressure from performance embedded in stretch targets permit employees to engage in illegal and unethical practices when working in other countries.

How do managers treat fixed overhead costs in the budget process?

Some companies refer to budgeting as targeting and other companies refer to budgets as profit plans.

Which of the following is not true about budgeting in multinational companies?

Microsoft refers to goals as ________ and distributes firm-level goals across the company,connecting them to organizational,team,and individual commitments.

A manager that works at a company that is evaluated as a profit center will more likely consider rush orders important because they impact sales.

What is the impact of budgeting on employee performance?

To avoid problems of budgetary slack,some companies use budgets primarily to plan and other companies use it to a lesser extent in performance evaluations.

How do managers react to budgets that challenge the manager?

The most frequent budget period is one year.

Budgets enable a company's managers to measure actual performance against predicted performance.

What is the concept of the bottom-up perspective of budgeting?

What is a bill of materials? Why do managers use it?

What should managers do if they use sensitivity analysis and they detect small declines in operating income? What could happen if direct material prices increase by 6% and the selling prices decline in the next year?

Which of the following is not true about ERP systems?

Estimates suggest that senior managers spend about of their time on budgeting;and,finance planning departments spend as much as on budgeting.

The beginning cash balance minus cash receipts equal the total cash available for needs before any financing.