Peach Company has the following information: $\begin{array}{lc} \text { Month } & \text { Budgeted Purchases } \\ \hline \text { January } & \$ 25,000 \\ \text { February } & 19,000 \\ \text { March } & 33,000 \\ \text { April } & 27,000 \\ \text { May } & 27,680 \end{array}$ Purchases are paid for in the following manner: 75% in the month of purchase 25% in the month after purchase _____ is the total estimated cash disbursement in March for the purchase of merchandise.

A) $22,500 B) $24,750 C) $29,500 D) $39,000 A) $22,500 B) $24,750 C) $29,500 D) $39,000

Villa Company has the following information: $\begin{array}{lr} \text { Month } & \text { Budgeted Purchases } \\ \hline \text { January } & \$ 56,800 \\ \text { February } & 49,000 \\ \text { March } & 30,520 \\ \text { April } & 35,480 \\ \text { May } & 27,680 \end{array}$ 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 estimated cash disbursement in May from April purchases.

A) $11,792 B) $17,740 C) $11,072 D) $13,840 A) $11,792 B) $17,740 C) $11,072 D) $13,840

The following sales budget has been prepared: $\begin{array}{lrr} \text { Month } & \text { Cash Sales } & \text { Credit Sales } \\ \hline \text { September } & \$ 100,000 & \$ 200,000 \\ \text { October } & 125,000 & 180,000 \\ \text { November } & 130,000 & 210,000 \\ \text { December } & 135,000 & 190,000 \end{array}$ 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 expected balance of Accounts Receivable as of December 31.

A) $190,000 B) $75,500 C) $116,000 D) $210,000 A) $190,000 B) $75,500 C) $116,000 D) $210,000

Pinto Company has the following data: $\begin{array}{lc} \text { Month } & \text { Budgeted Sales } \\ \text { January } & \$ 108,000 \\ \text { February } & 132,000 \\ \text { March } & 144,000 \\ \text { April } & 120,000 \end{array}$ The average markup on products is 40%, and the inventory at the end of December was $19,000.Desired inventory levels are 30% of next month's sales at cost._____ is the desired ending inventory for April.

A) $25,920 B) $17,280 C) $43,200 D) None of these answers is correct A) $25,920 B) $17,280 C) $43,200 D) None of these answers is correct

The following sales budget has been prepared: $\begin{array}{lrr} \text { Month } & \text { Cash Sales } & \text { Credit Sales } \\ \hline \text { September } & \$ 100,000 & \$ 200,000 \\ \text { October } & 125,000 & 180,000 \\ \text { November } & 130,000 & 210,000 \\ \text { December } & 135,000 & 190,000 \end{array}$ 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 September from September sales.

A) $100,000 B) $300,000 C) $272,000 D) $200,000 A) $100,000 B) $300,000 C) $272,000 D) $200,000

Exam 7: Introduction to Budgets and Preparing the Master Budget

Peach Company has the following information: Month Budgeted Purchases January \ 25,000 February 19,000 March 33,000 April 27,000 May 27,680 Purchases are paid for in the following manner: 75% in the month of purchase 25% in the month after purchase _____ is the total estimated cash disbursement in March for the purchase of merchandise.

(Multiple Choice)

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Question 81

The effectiveness of any budgeting system depends directly on whether a budget is understood and accepted by top management.

(True/False)

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Question 82

Villa Company has the following information: Month Budgeted Purchases January \ 56,800 February 49,000 March 30,520 April 35,480 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 estimated cash disbursement in May from April purchases.

(Multiple Choice)

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Question 83

What is the sequence of steps used in preparing the master budget?

(Multiple Choice)

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Question 84

All of the following are financial budgets except the _____.

(Multiple Choice)

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Question 85

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 expected balance of Accounts Receivable as of December 31.

(Multiple Choice)

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Question 86

For next year, Dunphy Company has budgeted sales of 30,000 units, target ending finished goods inventory of 1,000 units, and a beginning finished goods inventory of 800 units.All other inventories are zero._____ units should be pro?duced.

(Multiple Choice)

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Question 87

Gore Company has budgeted sales of 7,000 units, target ending finished goods inventory of 1,000 units, and a beginning finished goods inventory of 300 units. _____ units should be produced.

(Multiple Choice)

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Question 88

The working capital cycle moves from cash to inventory to receivables and back to cash.

(True/False)

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Question 89

The budgeting process that focuses on preparing the budgets for various functions such as production, selling, and administrative support

(Short Answer)

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Question 90

Overstating a manager's budgeted costs or understating a manager's budgeted revenues to create a budgeted profit level that is easier to achieve

(Short Answer)

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Question 91

A common form of master budget that adds a month in the future as the month just ended is dropped

(Short Answer)

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Question 92

All of the following are operating budgets except the _____.

(Multiple Choice)

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Question 93

A sales budget is a prediction of sales under a given set of conditions.

(True/False)

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Question 94

Pinto Company has the following data: Month Budgeted Sales January \ 108,000 February 132,000 March 144,000 April 120,000 The average markup on products is 40%, and the inventory at the end of December was $19,000.Desired inventory levels are 30% of next month's sales at cost._____ is the desired ending inventory for April.

(Multiple Choice)

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Question 95

Sales forecasts are usually prepared under the direction of the top sales executive.

(True/False)

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Question 96

Budgeted performance goals generally do not provide a better basis for evaluating actual results than do a simple comparison with past performance.

(True/False)

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Question 97

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 September from September sales.

(Multiple Choice)

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Question 98

Budgets are a manager's tool to plan, understand, and control operations.

(True/False)

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Question 99

Decisions made during long-range planning include the design of a new plant and whether to delete a product from a company's product line.

(True/False)

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Question 100

The effectiveness of any budgeting system depends directly on whether a budget is understood and accepted by top management.

What is the sequence of steps used in preparing the master budget?

All of the following are financial budgets except the _____.

For next year, Dunphy Company has budgeted sales of 30,000 units, target ending finished goods inventory of 1,000 units, and a beginning finished goods inventory of 800 units.All other inventories are zero._____ units should be pro?duced.

Gore Company has budgeted sales of 7,000 units, target ending finished goods inventory of 1,000 units, and a beginning finished goods inventory of 300 units. _____ units should be produced.

The working capital cycle moves from cash to inventory to receivables and back to cash.

The budgeting process that focuses on preparing the budgets for various functions such as production, selling, and administrative support

Overstating a manager's budgeted costs or understating a manager's budgeted revenues to create a budgeted profit level that is easier to achieve

A common form of master budget that adds a month in the future as the month just ended is dropped

All of the following are operating budgets except the _____.

A sales budget is a prediction of sales under a given set of conditions.

Sales forecasts are usually prepared under the direction of the top sales executive.

Budgeted performance goals generally do not provide a better basis for evaluating actual results than do a simple comparison with past performance.

Budgets are a manager's tool to plan, understand, and control operations.

Decisions made during long-range planning include the design of a new plant and whether to delete a product from a company's product line.

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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