Question 1

Accounting generally has the responsibility for

Accepted Answer

A) setting company goals. 
B) expressing the budget in financial terms. 
C) enforcing the budget. 
D) administration of the budget. 
A) setting company goals. 
B) expressing the budget in financial terms. 
C) enforcing the budget. 
D) administration of the budget.

Question 2

A budget

Accepted Answer

A) is a substitute for management. 
B) is an aid to management. 
C) can operate or enforce itself. 
D) is the responsibility of the accounting department. 
A) is a substitute for management. 
B) is an aid to management. 
C) can operate or enforce itself. 
D) is the responsibility of the accounting department.

Question 3

Which one of the following is not a benefit of budgeting?

Accepted Answer

A) It facilitates the coordination of activities. 
B) It provides definite objectives for evaluating performance. 
C) It provides assurance that the company will achieve its objectives. 
D) It requires all levels of management to plan ahead on a recurring basis. 
A) It facilitates the coordination of activities. 
B) It provides definite objectives for evaluating performance. 
C) It provides assurance that the company will achieve its objectives. 
D) It requires all levels of management to plan ahead on a recurring basis.

Question 4

The most common budget period is

Accepted Answer

A) one month. 
B) three months. 
C) six months. 
D) one year. 
A) one month. 
B) three months. 
C) six months. 
D) one year.

Question 5

Dolce Co.estimates its sales at 180,000 units in the first quarter and that sales will increase by 18,000 units each quarter over the year.They have, and desire, a 25% ending inventory of finished goods.Each unit sells for $25.40% of the sales are for cash.70% of the credit customers pay within the quarter.The remainder is received in the quarter following sale. 
-Cash collections for the third quarter are budgeted at

Accepted Answer

A) $3,051,000. 
B) $4,428,000. 
C) $5,319,000. 
D) $6,156,000. 
A) $3,051,000. 
B) $4,428,000. 
C) $5,319,000. 
D) $6,156,000.

Question 6

The longer the budget period, the more reliable the estimates of future outcomes.

Accepted Answer

A) True 
 B)False

Question 7

A well-developed budget can operate and enforce itself.

Accepted Answer

A) True 
 B)False

Question 8

The budget committee has the responsibility for coordinating the preparation of the budget.

Accepted Answer

A) True 
 B)False

Question 9

Lorie Nursery plans to sell 320 potted plants during April and 240 units in May.Lorie Nursery keeps 15% of the next month's sales as ending inventory.How many units should Lorie Nursery produce during April?

Accepted Answer

A) 308 
B) 332 
C) 320 
D) 356 
A) 308 
B) 332 
C) 320 
D) 356

Question 10

Kam Department Store reported the following information for 2013: $\begin{array}{llll}&\text { October }&\text {November }&\text {December }\
\text { Budgeted sales } & \$ 1,240,000 & \$1,160,000 & \$ 1,440,000 \
\end{array}$ All sales are on credit. 
-Customer amounts on account are collected 50% in the month of sale and 50% in the following month.
How much cash will Kam receive in November?

Accepted Answer

A) $580,000 
B) $1,300,000 
C) $1,200,000 
D) $1,160,000 
A) $580,000 
B) $1,300,000 
C) $1,200,000 
D) $1,160,000

Question 11

A company has budgeted direct materials purchases of $300,000 in July and $480,000 in August.Past experience indicates that the company pays for 70% of its purchases in the month of purchase and the remaining 30% in the next month.During August, the following items were budgeted: $$\begin{array} { l r } 
\text { Wages Expense } & \$ 150,000 \
\text { Purchase of office equipment } & 72,000 \
\text { Selling and Administrative Expenses } & 48,000 \
\text { Depreciation Expense } & 36,000
\end{array}$$ The budgeted cash disbursements for August are

Accepted Answer

A) $648,000. 
B) $426,000. 
C) $696,000. 
D) $732,000. 
A) $648,000. 
B) $426,000. 
C) $696,000. 
D) $732,000.

Question 12

The culmination of preparing operating budgets is the

Accepted Answer

A) budgeted balance sheet. 
B) production budget. 
C) cash budget. 
D) budgeted income statement. 
A) budgeted balance sheet. 
B) production budget. 
C) cash budget. 
D) budgeted income statement.

Question 13

Top management notices a variation from budget and an investigation of the difference reveals that the department manager could not be expected to have controlled the variation.Which of the following statements is applicable?

Accepted Answer

A) Department managers should be held accountable for all variances from budgets for their departments. 
B) Department managers should only be held accountable for controllable variances for their departments. 
C) Department managers should be credited for favorable variances even if they are beyond their control. 
D) Department managers' performances should not be evaluated based on actual results to budgeted results. 
A) Department managers should be held accountable for all variances from budgets for their departments. 
B) Department managers should only be held accountable for controllable variances for their departments. 
C) Department managers should be credited for favorable variances even if they are beyond their control. 
D) Department managers' performances should not be evaluated based on actual results to budgeted results.

Question 14

A common starting point in the budgeting process is

Accepted Answer

A) expected future net income. 
B) past performance. 
C) to motivate the sales force. 
D) a clean slate, with no expectations. 
A) expected future net income. 
B) past performance. 
C) to motivate the sales force. 
D) a clean slate, with no expectations.

Question 15

Teller Co.is planning to sell 900 boxes of ceramic tile, with production estimated at 870 boxes during May.Each box of tile requires 44 pounds of clay mix and a quarter hour of direct labor.Clay mix costs $0.40 per pound and employees of the company are paid $12.00 per hour.Manufacturing overhead is applied at a rate of 110% of direct labor costs.Teller has 3,900 pounds of clay mix in beginning inventory and wants to have 4,500 pounds in ending inventory. 
-What is the total amount to be budgeted in pounds for direct materials to be purchased for the month?

Accepted Answer

A) 38,280 
B) 37,680 
C) 38,880 
D) 40,200 
A) 38,280 
B) 37,680 
C) 38,880 
D) 40,200

Question 16

The single most important output in preparing financial budgets is the

Accepted Answer

A) sales forecast. 
B) determination of the unit cost of the product. 
C) cash budget. 
D) budgeted income statement. 
A) sales forecast. 
B) determination of the unit cost of the product. 
C) cash budget. 
D) budgeted income statement.

Question 17

In a production budget, total required production units are the budgeted sales units plus

Accepted Answer

A) beginning finished goods units. 
B) desired ending finished goods units. 
C) desired ending finished goods units plus beginning finished goods units. 
D) desired ending finished goods units minus beginning finished goods units. 
A) beginning finished goods units. 
B) desired ending finished goods units. 
C) desired ending finished goods units plus beginning finished goods units. 
D) desired ending finished goods units minus beginning finished goods units.

Question 18

Teller Co.is planning to sell 900 boxes of ceramic tile, with production estimated at 870 boxes during May.Each box of tile requires 44 pounds of clay mix and a quarter hour of direct labor.Clay mix costs $0.40 per pound and employees of the company are paid $12.00 per hour.Manufacturing overhead is applied at a rate of 110% of direct labor costs.Teller has 3,900 pounds of clay mix in beginning inventory and wants to have 4,500 pounds in ending inventory. 
-What is the total amount to be budgeted for manufacturing overhead for the month?

Accepted Answer

A) $2,871 
B) $2,970 
C) $11,484 
D) $11,880 
A) $2,871 
B) $2,970 
C) $11,484 
D) $11,880

Question 19

The production budget shows expected unit sales are 100,000.The required production units are 104,000.What are the beginning and desired ending finished goods units, respectively? $$\begin{array} { l c c } 
& \text { Beginning Units } & \text { Ending Units } \
\text { a. } & 10,000 & 6,000 \
\text { b. } & 6,000 & 10,000 \
\text { c. } & 4,000 & 10,000 \
\text { d. } & 10,000 & 4,000
\end{array}$$

Accepted Answer

The answer of The production budget shows expected unit sales...

Question 20

A benefit of budgeting is that it provides definite objectives for evaluating performance.

Accepted Answer

A) True 
 B)False

Accounting generally has the responsibility for

A budget

Which one of the following is not a benefit of budgeting?

The most common budget period is

The longer the budget period, the more reliable the estimates of future outcomes.

A well-developed budget can operate and enforce itself.

The budget committee has the responsibility for coordinating the preparation of the budget.

Lorie Nursery plans to sell 320 potted plants during April and 240 units in May.Lorie Nursery keeps 15% of the next month's sales as ending inventory.How many units should Lorie Nursery produce during April?

The culmination of preparing operating budgets is the

Top management notices a variation from budget and an investigation of the difference reveals that the department manager could not be expected to have controlled the variation.Which of the following statements is applicable?

A common starting point in the budgeting process is

The single most important output in preparing financial budgets is the

In a production budget, total required production units are the budgeted sales units plus

The production budget shows expected unit sales are 100,000.The required production units are 104,000.What are the beginning and desired ending finished goods units, respectively? Beginning Units Ending Units a. 10,000 6,000 b. 6,000 10,000 c. 4,000 10,000 d. 10,000 4,000

A benefit of budgeting is that it provides definite objectives for evaluating performance.

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

Accounting generally has the responsibility for

A budget

Which one of the following is not a benefit of budgeting?

The most common budget period is

The longer the budget period, the more reliable the estimates of future outcomes.

A well-developed budget can operate and enforce itself.

The budget committee has the responsibility for coordinating the preparation of the budget.

Lorie Nursery plans to sell 320 potted plants during April and 240 units in May.Lorie Nursery keeps 15% of the next month's sales as ending inventory.How many units should Lorie Nursery produce during April?

The culmination of preparing operating budgets is the

Top management notices a variation from budget and an investigation of the difference reveals that the department manager could not be expected to have controlled the variation.Which of the following statements is applicable?

A common starting point in the budgeting process is

The single most important output in preparing financial budgets is the

In a production budget, total required production units are the budgeted sales units plus

The production budget shows expected unit sales are 100,000.The required production units are 104,000.What are the beginning and desired ending finished goods units, respectively? Beginning Units Ending Units a. 10,000 6,000 b. 6,000 10,000 c. 4,000 10,000 d. 10,000 4,000

A benefit of budgeting is that it provides definite objectives for evaluating performance.

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