Question 1

Budgets incorporate managements goals and

Accepted Answer

A) are a strategic long range plan 
B) are both a short range and long range profit plan 
C) includes only financial aspects of an operation as those are the only items that can be quantified in a profit plan 
D) express management's operating and financial plan for a specified period - usually a fiscal year 
A) are a strategic long range plan 
B) are both a short range and long range profit plan 
C) includes only financial aspects of an operation as those are the only items that can be quantified in a profit plan 
D) express management's operating and financial plan for a specified period - usually a fiscal year

Question 2

A quality control manager of a golf ball maker is most likely to be responsible for a(n)________.

Accepted Answer

A) revenue center 
B) investment center 
C) cost center 
D) profit center 
A) revenue center 
B) investment center 
C) cost center 
D) profit center

Question 3

Violet Sales Corp,reports the year-end information from 2018 as follows:
 
Violet is developing the 2019 budget.In 2019 the company would like to increase selling prices by 3.5%,and as a result expects a decrease in sales volume of 14%.All other operating expenses are expected to remain constant.Assume that cost of goods sold is a variable cost and that operating expenses are a fixed cost.
Should Violet increase the selling price in 2019?

Accepted Answer

A) Yes,because sales revenue increases for 2019. 
B) Yes,because gross margin increases for 2019. 
C) No,because sales volume decreases for 2019. 
D) No,because operating income decreases for 2019. 
A) Yes,because sales revenue increases for 2019. 
B) Yes,because gross margin increases for 2019. 
C) No,because sales volume decreases for 2019. 
D) No,because operating income decreases for 2019.

Question 4

Bottom-up budgets entrusts senior managers to prepare budgets and lower-level managers to execute them.

Accepted Answer

A) True 
 B)False

Question 5

In general,which of the following budgets is prepared first?

Accepted Answer

A) sales budget 
B) production budget 
C) direct labor budget 
D) overhead budget 
A) sales budget 
B) production budget 
C) direct labor budget 
D) overhead budget

Question 6

Lubriderm Corporation has the following budgeted unit sales for the next six-month period:
   
There were 30,000 units of finished goods in inventory at the beginning of June.Plans are to have an inventory of finished products that equal 20% of the unit sales for the next month.
Five pounds of materials are required for each unit produced.Each pound of material costs $8.Inventory levels for materials are equal to 30% of the needs for the next month.Materials inventory on June 1 was 15,000 pounds.
Required:
a.Prepare production budgets in units for July,August,and September.
b.Prepare a purchases budget in pounds for July,August,and September,and give total purchases in both pounds and dollars for each month.

Accepted Answer

@#IMG-DLM&_TB5540_00_TB5540_00 @#IMG-DLM&_TB5540_0

Question 7

Nantucket Industries manufactures and sells two models of watches,Prime and Luxuria.It expects to sell 3,500 units of Prime and 1,500 units of Luxuria in 2019.The following estimates are given for 2019:
 
Nantucket had an inventory of 200 units of Prime and 105 units of Luxuria at the end of 2018.It has decided that as a measure to counter stock outages it will maintain ending inventory of 400 units of Prime and 230 units of Luxuria.
Each Luxuria watch requires one unit of Crimpson and has to be imported at a cost of $12.There were 120 units of Crimpson in stock at the end of 2018.The management does not want to have any stock of Crimpson at the end of 2019.
What is the total budgeted cost of goods sold for Nantucket Industries in 2019?

Accepted Answer

A) $1,325,000 
B) $1,415,000 
C) $1,433,000 
D) $1,625,000 
A) $1,325,000 
B) $1,415,000 
C) $1,433,000 
D) $1,625,000

Question 8

Activity-based budgeting makes it easier to ________.

Accepted Answer

A) determine a rolling budget 
B) prepare pro forma financial statements 
C) determine how to reduce costs 
D) execute a financial budget 
A) determine a rolling budget 
B) prepare pro forma financial statements 
C) determine how to reduce costs 
D) execute a financial budget

Question 9

Bradford,Inc. ,expects to sell 11,000 ceramic vases for $21 each.Direct materials costs are $3,direct manufacturing labor is $11,and manufacturing overhead is $5 per vase.The following inventory levels apply to 2019:
 
On the 2019 budgeted income statement,what amount will be reported for sales?

Accepted Answer

A) $241,500 
B) $220,500 
C) $252,000 
D) $231,000 
A) $241,500 
B) $220,500 
C) $252,000 
D) $231,000

Question 10

The following information pertains to the January operating budget for Murphy Corporation,a retailer:
 
For January,the amount budgeted for the nonmanufacturing costs budget is ________.

Accepted Answer

A) $90,400 
B) $10,100 
C) $178,000 
D) $19,000 
A) $90,400 
B) $10,100 
C) $178,000 
D) $19,000

Question 11

The following information pertains to Monroe Company:

How much cash will be paid to suppliers in March?

Accepted Answer

A) $46,400 
B) $56,000 
C) $96,000 
D) $102,400 
A) $46,400 
B) $56,000 
C) $96,000 
D) $102,400

Question 12

The cash budget is a schedule of expected cash receipts ,disbursements,and financing.

Accepted Answer

A) True 
 B)False

Question 13

One of the benefits of a well implemented and executed budget is communication.Which of the following best describes communication within the budgetary cycle?

Accepted Answer

A) meshing and balancing of all aspects of production or service 
B) making each manager aware of the plan and allowing each manager to understand the importance of the plan 
C) allocation of scarce resources across all functional areas of the company 
D) the calculation of deviations from plan 
A) meshing and balancing of all aspects of production or service 
B) making each manager aware of the plan and allowing each manager to understand the importance of the plan 
C) allocation of scarce resources across all functional areas of the company 
D) the calculation of deviations from plan

Question 14

Sherry and John Enterprises are using the kaizen approach to budgeting for 2018.The budgeted income statement for January 2018 is as follows:
 
Under the kaizen approach,cost of goods sold and variable operating expenses are budgeted to decline by 1% per month.
What is the budgeted operating income for March 2018?

Accepted Answer

A) -$18,100 
B) $396,550 
C) -$59,403 
D) $683,100 
A) -$18,100 
B) $396,550 
C) -$59,403 
D) $683,100

Question 15

Bradford,Inc. ,expects to sell 9,000 ceramic vases for $21 each.Direct materials costs are $3,direct manufacturing labor is $12,and manufacturing overhead is $3 per vase.The following inventory levels apply to 2019:
 
What are the 2019 budgeted production costs for direct materials,direct manufacturing labor,and manufacturing overhead,respectively?

Accepted Answer

A) $27,600;$110,400;$27,600 
B) $27,000;$108,000;$27,000 
C) $9,000;$36,000;$9,000 
D) $9,000;$0;$10,500 
A) $27,600;$110,400;$27,600 
B) $27,000;$108,000;$27,000 
C) $9,000;$36,000;$9,000 
D) $9,000;$0;$10,500

Question 16

Describe some of the drawbacks of using the operating budget as a control device.

Accepted Answer

When the operating budget is used as a c

Question 17

Bradford,Inc. ,expects to sell 8,000 ceramic vases for $21 each.Direct materials costs are $4,direct manufacturing labor is $10,and manufacturing overhead is $4 per vase.The following inventory levels apply to 2019:
 
On the 2019 budgeted income statement,what amount will be reported for cost of goods sold?

Accepted Answer

A) $198,000 
B) $151,200 
C) $144,000 
D) $136,800 
A) $198,000 
B) $151,200 
C) $144,000 
D) $136,800

Question 18

Steve Corporation is using the kaizen approach to budgeting for 2018.The budgeted income statement for January 2018 is as follows:

Under the kaizen approach,cost of goods sold and variable operating expenses are budgeted to decline by 1% per month.
Required:
Prepare a kaizen-based budgeted income statement for March of 2018.

Accepted Answer

@#IMG-DLM&_TB5540_00_TB5540_00

Question 19

After a budget is agreed upon and finalized by the management team,the amounts should NOT be changed for any reason.

Accepted Answer

A) True 
 B)False

Question 20

________ include a budgeted statement of cash flows and a budgeted balance sheet.

Accepted Answer

A) Revenue budgets 
B) Financial budgets 
C) Operating budgets 
D) Production budgets 
A) Revenue budgets 
B) Financial budgets 
C) Operating budgets 
D) Production budgets

Budgets incorporate managements goals and

A quality control manager of a golf ball maker is most likely to be responsible for a(n)________.

Bottom-up budgets entrusts senior managers to prepare budgets and lower-level managers to execute them.

In general,which of the following budgets is prepared first?

Activity-based budgeting makes it easier to ________.

Bradford,Inc. ,expects to sell 11,000 ceramic vases for $21 each.Direct materials costs are $3,direct manufacturing labor is $11,and manufacturing overhead is $5 per vase.The following inventory levels apply to 2019: On the 2019 budgeted income statement,what amount will be reported for sales?

The following information pertains to the January operating budget for Murphy Corporation,a retailer: For January,the amount budgeted for the nonmanufacturing costs budget is ________.

The following information pertains to Monroe Company: How much cash will be paid to suppliers in March?

The cash budget is a schedule of expected cash receipts ,disbursements,and financing.

One of the benefits of a well implemented and executed budget is communication.Which of the following best describes communication within the budgetary cycle?

Describe some of the drawbacks of using the operating budget as a control device.

After a budget is agreed upon and finalized by the management team,the amounts should NOT be changed for any reason.

________ include a budgeted statement of cash flows and a budgeted balance sheet.

The Manager and Management Accounting

An Introduction to Cost Terms and Purposes

Cost-Volume-Profit Analysis

Job Costing

Activity-Based Costing and Activity-Based Management

Flexible Budgets,direct-Cost Variances,and Management Control

Flexible Budgets, overhead Cost Variances, and Management Control

Inventory Costing and Capacity Analysis

Determining How Costs Behave

Decision Making and Relevant Information

Strategy,balanced Scorecard,and Strategic Profitability Analysis

Pricing Decisions and Cost Management

Cost Allocation, customer-Profitability Analysis, and Sales-Variance Analysis

Allocation of Support-Department Costs, common Costs, and Revenues

Cost Allocation: Joint Products and Byproducts

Process Costing

Spoilage, rework, and Scrap

Balanced Scorecard: Quality and Time

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

Filters

Exam 6: Master Budget and Responsibility Accounting

Budgets incorporate managements goals and

A quality control manager of a golf ball maker is most likely to be responsible for a(n)________.

Bottom-up budgets entrusts senior managers to prepare budgets and lower-level managers to execute them.

In general,which of the following budgets is prepared first?

Activity-based budgeting makes it easier to ________.

Bradford,Inc. ,expects to sell 11,000 ceramic vases for $21 each.Direct materials costs are $3,direct manufacturing labor is $11,and manufacturing overhead is $5 per vase.The following inventory levels apply to 2019: On the 2019 budgeted income statement,what amount will be reported for sales?

The following information pertains to the January operating budget for Murphy Corporation,a retailer: For January,the amount budgeted for the nonmanufacturing costs budget is ________.

The following information pertains to Monroe Company: How much cash will be paid to suppliers in March?

The cash budget is a schedule of expected cash receipts ,disbursements,and financing.

One of the benefits of a well implemented and executed budget is communication.Which of the following best describes communication within the budgetary cycle?

Describe some of the drawbacks of using the operating budget as a control device.

After a budget is agreed upon and finalized by the management team,the amounts should NOT be changed for any reason.

________ include a budgeted statement of cash flows and a budgeted balance sheet.

The Manager and Management Accounting

An Introduction to Cost Terms and Purposes

Cost-Volume-Profit Analysis

Job Costing

Activity-Based Costing and Activity-Based Management

Flexible Budgets,direct-Cost Variances,and Management Control

Flexible Budgets, overhead Cost Variances, and Management Control

Inventory Costing and Capacity Analysis

Determining How Costs Behave

Decision Making and Relevant Information

Strategy,balanced Scorecard,and Strategic Profitability Analysis

Pricing Decisions and Cost Management

Cost Allocation, customer-Profitability Analysis, and Sales-Variance Analysis

Allocation of Support-Department Costs, common Costs, and Revenues

Cost Allocation: Joint Products and Byproducts

Process Costing

Spoilage, rework, and Scrap

Balanced Scorecard: Quality and Time

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

Filters