Twilight Company has the following information: $\begin{array}{lr} \text { Month } & \text { Budgeted Purchases } \\ \hline \text { January } & \$ 26,800 \\ \text { February } & 29,000 \\ \text { March } & 30,520 \\ \text { April } & 29,480 \\ \text { May } & 27,680 \end{array}$ Purchases are paid for in the following manner: 10% in the month of purchase 50% in the month after purchase 40% two months after purchase _____ is the expected Accounts Payable balance as of May 31.

A) $11,792 B) $24,912 C) $36,704 D) $2,948 A) $11,792 B) $24,912 C) $36,704 D) $2,948

Moran Company's expected sales for April are $27,600.Information about other budgeted expenses is presented below. $\begin{array}{lr} \text { Budgeted } & \text { Expenses per Month } \\ \text { Wages } & \$ 2,000 \\ \text { Advertising } & 1,680 \\ \text { Depreciation } & 1,440 \\ \text { Rent } & 2,560 \\ \text { Other } & 5 \% \text { of sales } \end{array}$ All cash expenses are paid as incurred.____ is the total expected cash disbursements for expenses in April.

A) $9,060 B) $7,680 C) $6,240 D) $7,620 A) $9,060 B) $7,680 C) $6,240 D) $7,620

The following sales budget has been prepared: $\begin{array}{lcr} \text { Month } & \text { Cash Sales } & \text { Credit Sales } \\ \text { September } & \$ 100,000 & \$ 200,000 \\ \text { October } & 125,000 & 180,000 \\ \text { November } & 130,000 & 210,000 \\ \text { December } & 135,000 & 190,000 \end{array}$ Collections are 50% in the month of sale, 40% in the month following the sale, and 10% two months following the sale.No uncollectible accounts are anticipated._____ is the estimated cash collection in November.

A) $197,000 B) $327,000 C) $340,000 D) $130,000 A) $197,000 B) $327,000 C) $340,000 D) $130,000

Colts Corporation has the following information: $\begin{array}{lr} \text { Month } & \text { Budgeted Sales } \\ \hline \text { May } & \$ 46,000 \\ \text { June } & 50,000 \\ \text { July } & 52,000 \\ \text { August } & 48,000 \end{array}$ The cost of goods sold percentage is 65% and the desired inventory level is 25% of next month's sales._____ is the expected total purchases budgeted for July.

A) $33,800 B) $41,600 C) $33,150 D) None of these answers is correct A) $33,800 B) $41,600 C) $33,150 D) None of these answers is correct

Exam 7: Introduction to Budgets and Preparing the Master Budget

Twilight Company has the following information: Month Budgeted Purchases January \ 26,800 February 29,000 March 30,520 April 29,480 May 27,680 Purchases are paid for in the following manner: 10% in the month of purchase 50% in the month after purchase 40% two months after purchase _____ is the expected Accounts Payable balance as of May 31.

(Multiple Choice)

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Question 61

The cash budget begins with the ending cash balance from the previous period.

(True/False)

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Question 62

Budgets tell employees what their superiors expect of them.

(True/False)

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Question 63

The financial-budget process results in the _____.

(Multiple Choice)

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Question 64

The most forward-looking budget is the strategic plan.

(True/False)

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Question 65

Moran Company's expected sales for April are $27,600.Information about other budgeted expenses is presented below. Budgeted Expenses per Month Wages \ 2,000 Advertising 1,680 Depreciation 1,440 Rent 2,560 Other 5\% of sales All cash expenses are paid as incurred.____ is the total expected cash disbursements for expenses in April.

(Multiple Choice)

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Question 66

A good budget process communicates from the top down, but not from the bottom up.

(True/False)

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Question 67

The following sales budget has been prepared: Month Cash Sales Credit Sales September \ 100,000 \ 200,000 October 125,000 180,000 November 130,000 210,000 December 135,000 190,000 Collections are 50% in the month of sale, 40% in the month following the sale, and 10% two months following the sale.No uncollectible accounts are anticipated._____ is the estimated cash collection in November.

(Multiple Choice)

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Question 68

_____ are sometimes called rolling budgets.

(Multiple Choice)

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Question 69

The most important advantage of a spreadsheet is that spreadsheets _____.

(Multiple Choice)

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Question 70

_____ detail the planned expenditures for facilities, equipment, new products, and other long-term investments.

(Multiple Choice)

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Question 71

_____ is generally prepared as the first step in preparing the operating budgets.

(Multiple Choice)

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Question 72

A budget is an example of an informal business plan.

(True/False)

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Question 73

Colts Corporation has the following information: Month Budgeted Sales May \ 46,000 June 50,000 July 52,000 August 48,000 The cost of goods sold percentage is 65% and the desired inventory level is 25% of next month's sales._____ is the expected total purchases budgeted for July.

(Multiple Choice)

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Question 74

How do strategic planning, long-range planning, and budgeting differ?

(Essay)

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Question 75

Another name for an operating budget

(Short Answer)

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Question 76

An operating budget is the major part of a master budget that focuses on the income statement and its supporting schedules.

(True/False)

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Question 77

The master budget includes forecasts for all of the following except _____.

(Multiple Choice)

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Question 78

A budget is a qualitative expression of a plan of action.

(True/False)

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Question 79

???_____ models are mathematical models of the master budget that can react to any set of assumption about sales, costs, and product mix.

(Multiple Choice)

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Question 80

The cash budget begins with the ending cash balance from the previous period.

Budgets tell employees what their superiors expect of them.

The financial-budget process results in the _____.

The most forward-looking budget is the strategic plan.

A good budget process communicates from the top down, but not from the bottom up.

_____ are sometimes called rolling budgets.

The most important advantage of a spreadsheet is that spreadsheets _____.

_____ detail the planned expenditures for facilities, equipment, new products, and other long-term investments.

_____ is generally prepared as the first step in preparing the operating budgets.

A budget is an example of an informal business plan.

Colts Corporation has the following information: Month Budgeted Sales May \ 46,000 June 50,000 July 52,000 August 48,000 The cost of goods sold percentage is 65% and the desired inventory level is 25% of next month's sales._____ is the expected total purchases budgeted for July.

How do strategic planning, long-range planning, and budgeting differ?

Another name for an operating budget

An operating budget is the major part of a master budget that focuses on the income statement and its supporting schedules.

The master budget includes forecasts for all of the following except _____.

A budget is a qualitative expression of a plan of action.

???_____ models are mathematical models of the master budget that can react to any set of assumption about sales, costs, and product mix.

Managerial Accounting, the Business Organization, and Professional Ethics

Introduction to Cost Behavior and Cost-Volume Relationships

Measurement of Cost Behavior

Cost Management Systems and an Introduction to Activity-Based Costing

Relevant Information and Decision Making With a Focus on Pricing Decisions

Relevant Information and Decision Making: Operational Decisions

Flexible Budgets and Variance Analysis

Management Control Systems and Responsibility Accounting

Management Control in Decentralized Organizations

Capital Budgeting

Cost Allocation

Accounting for Overhead Costs

Job-Costing and Process-Costing Systems

Basic Accounting: Concepts, Techniques, and Conventions

Understanding Corporate Annual Reports: Basic Financial Statements

Understanding and Analyzing Consolidated Financial Statements

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