Question 1

Production and sales estimates for March for the Robin Co.are as follows:  The number of units expected to be manufactured in March is

Accepted Answer

A) 24,000 
B) 27,000 
C) 27,600 
D) 21,600

Question 2

The budgeting process is used to effectively communicate planned expectations regarding profits and expenses to the entire organization.

Accepted Answer

A) True 
 B)False

Question 3

The objectives of budgeting are 1 establishing specific goals for future operations, 2 executing plans to achieve the goals, and 3 periodically comparing actual results with these goals.

Accepted Answer

A) True 
 B)False

Question 4

What is the budgeted unit of production for March?

Accepted Answer

A) 256,000 
B) 206,000 
C) 214,000 
D) 298,000

Question 5

A series of budgets for varying rates of activity is termed an

Accepted Answer

A) flexible budget 
B) variable budget 
C) master budget 
D) activity budget

Question 6

The cash collections expected in September from accounts receivable are estimated to be

Accepted Answer

A) $223,600 
B) $145,600 
C) $182,000 
D) $168,000

Question 7

The master budget of a small manufacturer would normally include all necessary component budgets except the budgeted balance sheet.

Accepted Answer

A) True 
 B)False

Question 8

To meet projected annual sales, Bluegill Manufacturers, Inc.needs to produce 75,000 machines for the year.The estimated January 1 inventory is 7,000 units, and the desired December 31 inventory is 12,000 units.What are projected sales units for the year?

Accepted Answer

The answer of To meet projected annual sales, Bluegill Manufacturers,...

Question 9

If Division Inc.expects to sell 200,000 units in the current year, desires ending inventory of 24,000 units, and has 22,000 units on hand as of the beginning of the year, the budgeted volume of production for the year is 202,000 units.

Accepted Answer

A) True 
 B)False

Question 10

The total direct materials purchases assuming no beginning or ending inventory of material of Materials A and B required for August production is

Accepted Answer

A) $1,080,000 for A; $1,296,000 for B 
B) $1,080,000 for A; $648,000 for B 
C) $1,125,000 for A; $675,000 for B 
D) $1,170,000 for A; $702,000 for B

Question 11

Budgetary slack can be avoided if lower and mid-level managers are requested to support all of their spending requirements with specific operational plans.

Accepted Answer

A) True 
 B)False

Question 12

The flexible budget is, in effect, a series of static budgets for different levels of activity.

Accepted Answer

A) True 
 B)False

Question 13

Supervisor salaries and indirect factory wages would normally appear in the direct labor cost budget.

Accepted Answer

A) True 
 B)False

Question 14

As of January 1 of the current year, the Grackle Company had accounts receivables of $50,000.The sales for January, February, and March were as follows: $120,000, $140,000, and $150,000, respectively.Of each month's sales, 20% are for cash.Of the remaining 80% the credit sales, 60% are collected in the month of sale, with the remaining 40% collected in the following month.What is the total cash collected both from accounts receivable and cash sales in the month of March?

Accepted Answer

A) $74,800 
B) $146,800 
C) $102,000 
D) $116,800

Question 15

Budgets are prepared in the Accounting Department and monitored by various department managers.

Accepted Answer

A) True 
 B)False

Question 16

Match each phrase that follows with the term a-e it describes.
-occurs when budgets are too loose

Accepted Answer

A) planning 
B) directing 
C) controlling 
D) budget slack 
E) goal conflict

Question 17

When budget goals are set too tight, the budget becomes less effective as a tool for planning and controlling operations.

Accepted Answer

A) True 
 B)False

Question 18

Match each phrase that follows with the term a-e it describes.
-integrated set of operating and financing budgets for a period of time

Accepted Answer

A) planning 
B) directing 
C) controlling 
D) budget slack 
E) goal conflict

Question 19

Prepare a flexible budget for Cedar Jeans Company using production levels of 16,000, 18,000, and 20,000 units produced.The following is additional information necessary to complete the budget:
Variable costs:
Direct labor $6.00 per unit Direct materials $8.00 per unit
Variable manufacturing costs $2.50 per unit
Fixed costs:
Supervisor's salaries $80,000
Rent 12,000
Depreciation on equipment 24,000

Accepted Answer

The answer of Prepare a flexible budget for Cedar Jeans...

Question 20

Rodger's Cabinet Manufacturers uses flexible budgets that are based on the following manufacturing data for the month of July:
Direct materials $8 per unit
Direct labor $5 per unit
Electric power variable $0.30 per unit
Electric power fixed $4,000 per month
Supervisor salaries $25,000 per month
Property taxes on factory $4,000 per month
Straight-line depreciation $2,900 per month
Prepare a flexible budget for Rodger's based on production of 10,000, 15,000, and 20,000 units.

Accepted Answer

The answer of Rodger's Cabinet Manufacturers uses flexible budgets that...

Exam 6: Budgeting

Production and sales estimates for March for the Robin Co.are as follows: The number of units expected to be manufactured in March is

The budgeting process is used to effectively communicate planned expectations regarding profits and expenses to the entire organization.

The objectives of budgeting are 1 establishing specific goals for future operations, 2 executing plans to achieve the goals, and 3 periodically comparing actual results with these goals.

What is the budgeted unit of production for March?

A series of budgets for varying rates of activity is termed an

The cash collections expected in September from accounts receivable are estimated to be

The master budget of a small manufacturer would normally include all necessary component budgets except the budgeted balance sheet.

To meet projected annual sales, Bluegill Manufacturers, Inc.needs to produce 75,000 machines for the year.The estimated January 1 inventory is 7,000 units, and the desired December 31 inventory is 12,000 units.What are projected sales units for the year?

If Division Inc.expects to sell 200,000 units in the current year, desires ending inventory of 24,000 units, and has 22,000 units on hand as of the beginning of the year, the budgeted volume of production for the year is 202,000 units.

The total direct materials purchases assuming no beginning or ending inventory of material of Materials A and B required for August production is

Budgetary slack can be avoided if lower and mid-level managers are requested to support all of their spending requirements with specific operational plans.

The flexible budget is, in effect, a series of static budgets for different levels of activity.

Supervisor salaries and indirect factory wages would normally appear in the direct labor cost budget.

Budgets are prepared in the Accounting Department and monitored by various department managers.

Match each phrase that follows with the term a-e it describes. -occurs when budgets are too loose

When budget goals are set too tight, the budget becomes less effective as a tool for planning and controlling operations.

Match each phrase that follows with the term a-e it describes. -integrated set of operating and financing budgets for a period of time