Exam 7: Introduction to Budgets and Preparing the Master Budget

Peach Company has the following information: Purchases are paid as follows: 75% in the month of purchase 25% one month after purchase What is the estimated cash disbursement for purchases in March?

________ expense is driven by sales volume.

________ set the overall goals and objectives of the organization.

Bates Corporation has the following sales budget: Credit sales are 80% of total sales.Collections of credit sales are 80% in the month of sale,15% in the month after sale and 5% are never collected. Required: Prepare a schedule of cash collections for June,July and August.

The following sales budget has been prepared: Collections of credit sales are 50% in the month of sale,40% in the month following sale,and 10% two months following sale.No uncollectible accounts are expected.What is the expected balance in Accounts Receivable at November 30?

A spreadsheet can be used to prepare ________.

Potential problems that can limit the advantages of budgeting do NOT include ________.

________ are sometimes called rolling budgets.

Pinto Company has the following data: Cost of goods sold average 60% of sales.The inventory at December 31 was $19,440.Desired ending inventory levels are 30% of next month's sales at cost.What is the desired ending inventory value at February 28?

A major drawback of using historical results for judging current performance is that ________.

Line operating managers usually prepare and use the operating budget.

Yesterday Company has a sales budget for next month of $300,000.Cost of goods sold is expected to be 40% of sales.All units are paid for in the month following purchase.The beginning inventory is $10,000 and an ending inventory of $12,000 is desired.Beginning accounts payable is $76,000.The purchases for next month are ________.

The following sales budget has been prepared: Collection of credit sales are 50% in the month of sale,40% in the month following sale,and 10% two months following sale.No uncollectible accounts are expected.What is the expected balance of Accounts Receivable at October 31?

The master budget quantifies forecasts for all of the following EXCEPT ________.

A major drawback of using historical results for judging current performance is that inefficiencies may be concealed in past performance.

Donald Company has the following information: Purchases are paid as follows: 10% in the month of purchase 50% one month after purchase 40% two months after purchase What is the estimated cash disbursement in March from January purchases?

Diamond Company has the following sales budget for the last six months of 2010: Historically,the cash collection of sales has been as follows: 65% of sales collected in month of sale 25% of sales collected in month following sale 8% of sales collected in second month following sale 2% of sales uncollectible What is the expected cash collection of sales in October?

The first step in preparing the master budget is the ________.

The following sales budget has been prepared: Collections of credit sales are 50% in the month of sale,40% in the month following sale,and 10% two months following sale.No uncollectible accounts are expected.What are the estimated cash collections in December?

A company is preparing a budgeted balance sheet.The Ending Balance of Cash comes from the ________.