Question 1

The production budget shows that expected unit sales are 48,000.The total required units are 54,000.What are the required production units?

Accepted Answer

A) 6,000 
B) 9,000 
C) 12,000 
D) Cannot be determined from the data provided. 
A) 6,000 
B) 9,000 
C) 12,000 
D) Cannot be determined from the data provided. D

Question 2

Dex Industries expects to purchase $120,000 of materials in March and $140,000 of materials in April.Three-fourths of all purchases are paid for in the month of purchase, and the other one-fourth are paid for in the month following the month of purchase.In addition, a 2% discount is received for payments made in the month of purchase.How much will April's cash disbursements for materials purchases be?

Accepted Answer

A) $88,200 
B) $108,200 
C) $132,900 
D) $120,000 
A) $88,200 
B) $108,200 
C) $132,900 
D) $120,000 C

Question 3

The total direct labor hours required in preparing a direct labor budget are calculated using the

Accepted Answer

A) sales forecast. 
B) production budget. 
C) direct materials budget. 
D) sales budget. 
A) sales forecast. 
B) production budget. 
C) direct materials budget. 
D) sales budget. B

Question 4

The number of direct labor hours needed for production is obtained from the production budget.

Accepted Answer

A) True 
 B)False

Question 5

Mapleview, Inc.has the following budgeted sales: July $200,000, August $300,000, and September $250,000.40% of the sales are for cash and 60% are on credit.For the credit sales, 50% are collected in the month of sale, and 50% the next month.The total expected cash receipts during September are

Accepted Answer

A) $280,000. 
B) $265,000. 
C) $262,500. 
D) $250,000. 
A) $280,000. 
B) $265,000. 
C) $262,500. 
D) $250,000.

Question 6

The formula for determining budgeted merchandise purchases is budgeted

Accepted Answer

A) production + desired ending inventory - beginning inventory. 
B) sales + beginning inventory - desired ending inventory. 
C) cost of goods sold + desired ending inventory - beginning inventory. 
D) cost of goods sold + beginning inventory - desired ending inventory. 
A) production + desired ending inventory - beginning inventory. 
B) sales + beginning inventory - desired ending inventory. 
C) cost of goods sold + desired ending inventory - beginning inventory. 
D) cost of goods sold + beginning inventory - desired ending inventory.

Question 7

The cash budget reflects

Accepted Answer

A) all revenues and all expenses for a period. 
B) expected cash receipts and cash disbursements from all sources. 
C) all the items that appear on a budgeted income statement. 
D) all the items that appear on a budgeted balance sheet. 
A) all revenues and all expenses for a period. 
B) expected cash receipts and cash disbursements from all sources. 
C) all the items that appear on a budgeted income statement. 
D) all the items that appear on a budgeted balance sheet.

Question 8

In many companies, responsibility for coordinating the preparation of the budget is assigned to

Accepted Answer

A) the company's independent certified public accountants. 
B) the company's internal auditors. 
C) the company's board of directors. 
D) a budget committee. 
A) the company's independent certified public accountants. 
B) the company's internal auditors. 
C) the company's board of directors. 
D) a budget committee.

Question 9

The following information is taken from the production budget for the first quarter: $$\begin{array} { l r } 
\text { Beginning inventory in units } & 1,200 \
\text { Sales budgeted for the quarter } & 456,000 \
\text { Production capacity in units } & 472,000
\end{array}$$ How many finished goods units should be produced during the quarter if the company desires 3,200 units available to start the next quarter?

Accepted Answer

A) 458,000 
B) 454,000 
C) 474,000 
D) 459,200 
A) 458,000 
B) 454,000 
C) 474,000 
D) 459,200

Question 10

Which one of the following is a problem resulting from a service company being overstaffed?

Accepted Answer

A) Labor costs will be disproportionately low. 
B) Profits will be higher because of the additional salaries. 
C) Staff turnover may increase. 
D) Revenue may be lost. 
A) Labor costs will be disproportionately low. 
B) Profits will be higher because of the additional salaries. 
C) Staff turnover may increase. 
D) Revenue may be lost.

Question 11

Instead of a production budget, a merchandiser will prepare a

Accepted Answer

A) pseudo-production budget. 
B) merchandise purchases budget. 
C) master time sheet. 
D) sales forecast. 
A) pseudo-production budget. 
B) merchandise purchases budget. 
C) master time sheet. 
D) sales forecast.

Question 12

A budget can be used as a basis for evaluating performance.

Accepted Answer

A) True 
 B)False

Question 13

A budget can facilitate the coordination of activities among the segments of a large company.

Accepted Answer

A) True 
 B)False

Question 14

A budget can be a means of communicating a company's objectives to external parties.

Accepted Answer

A) True 
 B)False

Question 15

Garnett Co.expects to purchase $180,000 of materials in July and $210,000 of materials in August.Three-fourths of all purchases are paid for in the month of purchase, and the other one-fourth are paid for in the month following the month of purchase.How much will August's cash disbursements for materials purchases be?

Accepted Answer

A) $135,000 
B) $157,500 
C) $202,500 
D) $210,000 
A) $135,000 
B) $157,500 
C) $202,500 
D) $210,000

Question 16

The production budget shows expected unit sales of 32,000.Beginning finished goods units are 3,600.Required production units are 33,600.What are the desired ending finished goods units?

Accepted Answer

A) 2,000 
B) 3,600 
C) 6,400 
D) 5,200 
A) 2,000 
B) 3,600 
C) 6,400 
D) 5,200

Question 17

On January 1, Kale Company has a beginning cash balance of $42,000.During the year, the company expects cash disbursements of $340,000 and cash receipts of $290,000.If Kale requires an ending cash balance of $40,000, the company must borrow

Accepted Answer

A) $32,000. 
B) $40,000. 
C) $48,000. 
D) $92,000. 
A) $32,000. 
B) $40,000. 
C) $48,000. 
D) $92,000.

Question 18

Budgeting in not-for-profit organizations

Accepted Answer

A) is not important because they are not profit-oriented. 
B) usually starts with budgeting expenditures, rather than receipts. 
C) is necessary only if some product is produced and sold. 
D) consists entirely of budgeted contributions. 
A) is not important because they are not profit-oriented. 
B) usually starts with budgeting expenditures, rather than receipts. 
C) is necessary only if some product is produced and sold. 
D) consists entirely of budgeted contributions.

Question 19

A critical factor in budgeting for a service firm is to

Accepted Answer

A) hire professional staff to perform the budgeting work. 
B) coordinate professional staff needs with anticipated services. 
C) classify all personnel as either variable or fixed. 
D) budget expenditures before anticipated receipts. 
A) hire professional staff to perform the budgeting work. 
B) coordinate professional staff needs with anticipated services. 
C) classify all personnel as either variable or fixed. 
D) budget expenditures before anticipated receipts.

Question 20

Which of the following does not appear as a separate section on the cash budget?

Accepted Answer

A) Cash receipts 
B) Cash disbursements 
C) Capital expenditures 
D) Financing 
A) Cash receipts 
B) Cash disbursements 
C) Capital expenditures 
D) Financing

The production budget shows that expected unit sales are 48,000.The total required units are 54,000.What are the required production units?

The total direct labor hours required in preparing a direct labor budget are calculated using the

The number of direct labor hours needed for production is obtained from the production budget.

Mapleview, Inc.has the following budgeted sales: July $200,000, August $300,000, and September $250,000.40% of the sales are for cash and 60% are on credit.For the credit sales, 50% are collected in the month of sale, and 50% the next month.The total expected cash receipts during September are

The formula for determining budgeted merchandise purchases is budgeted

The cash budget reflects

In many companies, responsibility for coordinating the preparation of the budget is assigned to

Which one of the following is a problem resulting from a service company being overstaffed?

Instead of a production budget, a merchandiser will prepare a

A budget can be used as a basis for evaluating performance.

A budget can facilitate the coordination of activities among the segments of a large company.

A budget can be a means of communicating a company's objectives to external parties.

The production budget shows expected unit sales of 32,000.Beginning finished goods units are 3,600.Required production units are 33,600.What are the desired ending finished goods units?

On January 1, Kale Company has a beginning cash balance of $42,000.During the year, the company expects cash disbursements of $340,000 and cash receipts of $290,000.If Kale requires an ending cash balance of $40,000, the company must borrow

Budgeting in not-for-profit organizations

A critical factor in budgeting for a service firm is to

Which of the following does not appear as a separate section on the cash budget?

Introduction to Financial Statements

A Further Look at Financial Statements

The Accounting Information System

Accrual Accounting Concepts

Merchandising Operations and the Multiple-Step Income Statement

Reporting and Analyzing Inventory

Fraud, Internal Control, and Cash

Reporting and Analyzing Receivables

Reporting and Analyzing Liabilities

Reporting and Analyzing Stockholders Equity

Statement of Cash Flows

Financial Analysis: the Big Picture

Managerial Accounting

Time Value of Money and Present Value Calculations

Filters

Exam 9: Reporting and Analyzing Long-Lived Assets

The production budget shows that expected unit sales are 48,000.The total required units are 54,000.What are the required production units?

The total direct labor hours required in preparing a direct labor budget are calculated using the

The number of direct labor hours needed for production is obtained from the production budget.

Mapleview, Inc.has the following budgeted sales: July $200,000, August $300,000, and September $250,000.40% of the sales are for cash and 60% are on credit.For the credit sales, 50% are collected in the month of sale, and 50% the next month.The total expected cash receipts during September are

The formula for determining budgeted merchandise purchases is budgeted

The cash budget reflects

In many companies, responsibility for coordinating the preparation of the budget is assigned to

Which one of the following is a problem resulting from a service company being overstaffed?

Instead of a production budget, a merchandiser will prepare a

A budget can be used as a basis for evaluating performance.

A budget can facilitate the coordination of activities among the segments of a large company.

A budget can be a means of communicating a company's objectives to external parties.

The production budget shows expected unit sales of 32,000.Beginning finished goods units are 3,600.Required production units are 33,600.What are the desired ending finished goods units?

On January 1, Kale Company has a beginning cash balance of $42,000.During the year, the company expects cash disbursements of $340,000 and cash receipts of $290,000.If Kale requires an ending cash balance of $40,000, the company must borrow

Budgeting in not-for-profit organizations

A critical factor in budgeting for a service firm is to

Which of the following does not appear as a separate section on the cash budget?

Introduction to Financial Statements

A Further Look at Financial Statements

The Accounting Information System

Accrual Accounting Concepts

Merchandising Operations and the Multiple-Step Income Statement

Reporting and Analyzing Inventory

Fraud, Internal Control, and Cash

Reporting and Analyzing Receivables

Reporting and Analyzing Liabilities

Reporting and Analyzing Stockholders Equity

Statement of Cash Flows

Financial Analysis: the Big Picture

Managerial Accounting

Time Value of Money and Present Value Calculations

Filters