Question 1

Budgeted production depends on:

Accepted Answer

A) budgeted sales and expected changes in inventory levels. 
B) the manufacturing overhead costs budget. 
C) the direct manufacturing labour budget. 
D) the direct materials usage budget and direct material purchases budget. 
A) budgeted sales and expected changes in inventory levels. 
B) the manufacturing overhead costs budget. 
C) the direct manufacturing labour budget. 
D) the direct materials usage budget and direct material purchases budget.

Question 2

Budgeted financial statements are also referred to as pro forma statements.

Accepted Answer

A) True 
 B)False

Question 3

Some companies use budgets primarily for which of the following purposes to avoid problems of budgetary slack?

Accepted Answer

A) Controlling 
B) Planning 
C) Forecasting 
D) Evaluation 
A) Controlling 
B) Planning 
C) Forecasting 
D) Evaluation

Question 4

Wollondilly Company has budgeted sales volume of 33 000 units and budgeted production of 30 000 units,while 5000 units are in beginning finished goods inventory.How many units are targeted for ending finished goods inventory?

Accepted Answer

A) 3000 units 
B) 8000 units 
C) 5000 units 
D) 2000 units 
A) 3000 units 
B) 8000 units 
C) 5000 units 
D) 2000 units

Question 5

Answer the following questions using the information below:
The following information pertains to the January operating budget for Canberra Corporation.
∙ Budgeted sales for January $100 000 and for February $200 000.
∙ Collections for sales are 70% in the month of sale and 30% the next month.
∙ Gross margin is 30% of sales.
∙ Administrative costs are $10 000 each month.
∙ Beginning accounts receivable is $20 000.
∙ Beginning inventory is $14 000.
∙ Beginning accounts payable is $60 000.(All from inventory purchases. )
∙ Purchases are paid in full the following month.
∙ Desired ending inventory is 20% of next month's cost of goods sold (COGS).
-For January,budgeted cost of goods sold is:

Accepted Answer

A) $20 000. 
B) $30 000. 
C) $40 000. 
D) None of these answers are correct. 
A) $20 000. 
B) $30 000. 
C) $40 000. 
D) None of these answers are correct.

Question 6

Answer the following questions using the information below:
The following information pertains to the January operating budget for Brindabella Corporation,a retailer:
Budgeted sales are $300 000 for January
Collections of sales are 50% in the month of sale and 50% the next month
Cost of goods sold averages 70% of sales
Merchandise purchases total $250 000 in January
Marketing costs are $3000 each month
Distribution costs are $5000 each month
Administrative costs are $10 000 each month
-For January,budgeted gross margin is:

Accepted Answer

A) $100 000. 
B) $50 000. 
C) $90 000. 
D) $140 000. 
A) $100 000. 
B) $50 000. 
C) $90 000. 
D) $140 000.

Question 7

Answer the following questions using the information below:
The following information pertains to the January operating budget for Canberra Corporation.
∙ Budgeted sales for January $100 000 and for February $200 000.
∙ Collections for sales are 70% in the month of sale and 30% the next month.
∙ Gross margin is 30% of sales.
∙ Administrative costs are $10 000 each month.
∙ Beginning accounts receivable is $20 000.
∙ Beginning inventory is $14 000.
∙ Beginning accounts payable is $60 000.(All from inventory purchases. )
∙ Purchases are paid in full the following month.
∙ Desired ending inventory is 20% of next month's cost of goods sold (COGS).
-For January,budgeted cash collections are:

Accepted Answer

A) $60 000. 
B) $20 000. 
C) $90 000. 
D) None of these answers are correct. 
A) $60 000. 
B) $20 000. 
C) $90 000. 
D) None of these answers are correct.

Question 8

The ________ budget is finalised only after several rounds of discussions between top management and the managers responsible for various business functions in the value chain.

Accepted Answer

A) production 
B) master 
C) direct labour 
D) non-manufacturing 
A) production 
B) master 
C) direct labour 
D) non-manufacturing

Question 9

A budget:

Accepted Answer

A) generally includes both financial and non-financial aspects of the plan. 
B) is the quantitative expression of a proposed plan of action by management. 
C) serves as a blueprint for the company to follow in an upcoming period. 
D) is an aid to coordinate what needs to be done. 
E) All of the above are correct. 
A) generally includes both financial and non-financial aspects of the plan. 
B) is the quantitative expression of a proposed plan of action by management. 
C) serves as a blueprint for the company to follow in an upcoming period. 
D) is an aid to coordinate what needs to be done. 
E) All of the above are correct.

Question 10

In a profit centre,a manager is responsible for investments,revenues,and costs.

Accepted Answer

A) True 
 B)False

Question 11

The cash budget and the budgeted income statement can be used to prepare two other summary financial statements-the budgeted balance sheet and the budgeted ________.

Accepted Answer

A) bank statement. 
B) income statement. 
C) statement of cash flows. 
D) operating budget. 
A) bank statement. 
B) income statement. 
C) statement of cash flows. 
D) operating budget.

Question 12

Budgets should:

Accepted Answer

A) be administered rigidly. 
B) include only variable costs. 
C) be flexible. 
D) only be developed for short periods of time. 
A) be administered rigidly. 
B) include only variable costs. 
C) be flexible. 
D) only be developed for short periods of time.

Question 13

Budgets help managers assess strategic risks and opportunities (including both environmental and social opportunities)by providing them with feedback about the likely effects of their strategies and plans.

Accepted Answer

A) True 
 B)False

Question 14

Answer the following questions using the information below:
Beerwah Company provides the following data for next year:
 $$\begin{array} { l r } 
\text { Month } & \text { Budgeted Sales } \
\text { January } & \$ 160000 \
\text { February } & 144000 \
\text { March } & 176000 \
\text { April } & 192000
\end{array}$$ The gross profit rate is 40% of sales.Inventory at the end of December is $21 600 and target ending inventory levels are 30% of next month's sales,stated at cost.
-Purchases budgeted for February total:

Accepted Answer

A) $92 160. 
B) $115 200. 
C) $60 480. 
D) $64 800. 
A) $92 160. 
B) $115 200. 
C) $60 480. 
D) $64 800.

Question 15

Answer the following questions using the information below:
Beerwah Company provides the following data for next year:
 $$\begin{array} { l r } 
\text { Month } & \text { Budgeted Sales } \
\text { January } & \$ 160000 \
\text { February } & 144000 \
\text { March } & 176000 \
\text { April } & 192000
\end{array}$$ The gross profit rate is 40% of sales.Inventory at the end of December is $21 600 and target ending inventory levels are 30% of next month's sales,stated at cost.
-Purchases budgeted for January total:

Accepted Answer

A) $72 000. 
B) $74 160. 
C) $100 320. 
D) $130 800. 
A) $72 000. 
B) $74 160. 
C) $100 320. 
D) $130 800.

Question 16

Variances between actual and budgeted amounts inform management about performance relative to the budget.

Accepted Answer

A) True 
 B)False

Question 17

Describe operating and financial budgets and give at least two examples of each.

Accepted Answer

Operating budgets specify the expected o

Question 18

Building in budgetary slack includes:

Accepted Answer

A) underestimating budgeted costs. 
B) overestimating budgeted revenues. 
C) making budgeted targets more easily achievable. 
D) All of these answers are correct. 
A) underestimating budgeted costs. 
B) overestimating budgeted revenues. 
C) making budgeted targets more easily achievable. 
D) All of these answers are correct.

Question 19

If initial budget estimates prove unacceptable,planners achieve the MOST benefit from:

Accepted Answer

A) deciding not to budget this year. 
B) using last year's budget. 
C) planning again in light of feedback and current conditions. 
D) accepting an unbalanced budget. 
A) deciding not to budget this year. 
B) using last year's budget. 
C) planning again in light of feedback and current conditions. 
D) accepting an unbalanced budget.

Question 20

A responsibility centre can be structured to promote better alignment of individual and company goals.

Accepted Answer

A) True 
 B)False

Budgeted production depends on:

Budgeted financial statements are also referred to as pro forma statements.

Some companies use budgets primarily for which of the following purposes to avoid problems of budgetary slack?

Wollondilly Company has budgeted sales volume of 33 000 units and budgeted production of 30 000 units,while 5000 units are in beginning finished goods inventory.How many units are targeted for ending finished goods inventory?

The ________ budget is finalised only after several rounds of discussions between top management and the managers responsible for various business functions in the value chain.

A budget:

In a profit centre,a manager is responsible for investments,revenues,and costs.

The cash budget and the budgeted income statement can be used to prepare two other summary financial statements-the budgeted balance sheet and the budgeted ________.

Budgets should:

Budgets help managers assess strategic risks and opportunities (including both environmental and social opportunities)by providing them with feedback about the likely effects of their strategies and plans.

Variances between actual and budgeted amounts inform management about performance relative to the budget.

Describe operating and financial budgets and give at least two examples of each.

Building in budgetary slack includes:

If initial budget estimates prove unacceptable,planners achieve the MOST benefit from:

A responsibility centre can be structured to promote better alignment of individual and company goals.

Management Accounting in Context

Different Costs for Different Purposes

Determining How Costs Behave

Costvolumeprofit Analysis

Estimating the Cost of Producing Services

Estimating the Costs of Products and Inventory

Target Costing, Managing Activities and Managing Capacity

Activity-Based Management and Activity-Based Costing

Pricing and Customer Profitability

Decision Making and Relevant Information

Flexible Budgets, Direct Cost Variances and Management Control

Flexible Budgets, Overhead Cost Variances and Management Control

Allocation of Support-Department Costs, Common Costs and Revenues

Strategy Formation, Strategic Control and the Balanced Scorecard

Quality, Time and the Balanced Scorecard

Inventory Management, Just-In-Time and Simplified Costing Methods

Capital Budgeting and Cost Analysis

Management Control Systems, Transfer Pricing and Multinational Considerations

Performance Measurement, Compensation and Multinational Considerations

Measuring and Reporting Sustainability

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Exam 11: Budgeting, Management Control and Responsibility Accounting

Budgeted production depends on:

Budgeted financial statements are also referred to as pro forma statements.

Some companies use budgets primarily for which of the following purposes to avoid problems of budgetary slack?

Wollondilly Company has budgeted sales volume of 33 000 units and budgeted production of 30 000 units,while 5000 units are in beginning finished goods inventory.How many units are targeted for ending finished goods inventory?

The ________ budget is finalised only after several rounds of discussions between top management and the managers responsible for various business functions in the value chain.

A budget:

In a profit centre,a manager is responsible for investments,revenues,and costs.

The cash budget and the budgeted income statement can be used to prepare two other summary financial statements-the budgeted balance sheet and the budgeted ________.

Budgets should:

Budgets help managers assess strategic risks and opportunities (including both environmental and social opportunities)by providing them with feedback about the likely effects of their strategies and plans.

Variances between actual and budgeted amounts inform management about performance relative to the budget.

Describe operating and financial budgets and give at least two examples of each.

Building in budgetary slack includes:

If initial budget estimates prove unacceptable,planners achieve the MOST benefit from:

A responsibility centre can be structured to promote better alignment of individual and company goals.

Management Accounting in Context

Different Costs for Different Purposes

Determining How Costs Behave

Costvolumeprofit Analysis

Estimating the Cost of Producing Services

Estimating the Costs of Products and Inventory

Target Costing, Managing Activities and Managing Capacity

Activity-Based Management and Activity-Based Costing

Pricing and Customer Profitability

Decision Making and Relevant Information

Flexible Budgets, Direct Cost Variances and Management Control

Flexible Budgets, Overhead Cost Variances and Management Control

Allocation of Support-Department Costs, Common Costs and Revenues

Strategy Formation, Strategic Control and the Balanced Scorecard

Quality, Time and the Balanced Scorecard

Inventory Management, Just-In-Time and Simplified Costing Methods

Capital Budgeting and Cost Analysis

Management Control Systems, Transfer Pricing and Multinational Considerations

Performance Measurement, Compensation and Multinational Considerations

Measuring and Reporting Sustainability

Filters