Question 1

Cash outflows for interest on line of credit will be shown:

Accepted Answer

A)  on the cash receipts budget. 
B)  in the investing activity section of the cash summary budget. 
C)  on the summary cash budget. 
D)  on the selling and administrative expense budget 
A)  on the cash receipts budget. 
B)  in the investing activity section of the cash summary budget. 
C)  on the summary cash budget. 
D)  on the selling and administrative expense budget

Question 2

Camden Products Inc. manufacturers travel accessories. The company's controller has prepared the following static budget of one of the product lines for the month of November:   Actual production during November was 1,300 units and actual direct labor cost was $2,520.
If Camden prepares a flexible budget for November, the projected direct labor cost would be:

Accepted Answer

A)  $1,800 
B)  $2,520 
C)  $2,340 
D)  $1,938 
A)  $1,800 
B)  $2,520 
C)  $2,340 
D)  $1,938

Question 3

Donnelly Manufacturing Donnelly Manufacturing sells cedar birdhouses. The company has prepared the following sales forecast for the third quarter of 2013:
  Inventory at June 30, 2013 was budgeted at 1,500 units. Management would like the desired quantity of finished goods inventory at the end of each month to be equal to 15% of next month's budgeted unit sales. October's sales are projected to be 24,000 units.
Each completed unit of finished product requires 2.5 square feet of cedar at a cost of $3.5 per square foot.
Refer to the Donnelly Manufacturing information above. The total required production of birdhouses for the third quarter of 2013 is:

Accepted Answer

A)  39,900 units 
B)  44,100 units 
C)  45,600 units 
D)  40,500 units 
A)  39,900 units 
B)  44,100 units 
C)  45,600 units 
D)  40,500 units

Question 4

Which of the following is an advantage of the budgeting process?

Accepted Answer

A)  It requires very little input from various departmental managers, leaving them more time to devote to day-to-day activities. 
B)  It can define specific goals and objectives that may be used in evaluating future job performance. 
C)  It forces management to focus on the past and not be distracted by the day-to-day operations of the business. 
D)  It requires no communication between various managers in the organization. 
A)  It requires very little input from various departmental managers, leaving them more time to devote to day-to-day activities. 
B)  It can define specific goals and objectives that may be used in evaluating future job performance. 
C)  It forces management to focus on the past and not be distracted by the day-to-day operations of the business. 
D)  It requires no communication between various managers in the organization.

Question 5

Budgets are:

Accepted Answer

A)  future oriented. 
B)  for managers only. 
C)  required by GAAP. 
D)  typically not used by small business. 
A)  future oriented. 
B)  for managers only. 
C)  required by GAAP. 
D)  typically not used by small business.

Question 6

Which of the following equations best depicts a basic production budget?

Accepted Answer

A)  Required production = Projected sales - Desired ending inventory + Beginning inventory 
B)  Required production = Projected sales + Desired ending inventory - Beginning inventory 
C)  Required production = Projected sales - Desired ending inventory - Beginning inventory 
D)  Required production = Projected sales + Desired ending inventory + Beginning inventory 
A)  Required production = Projected sales - Desired ending inventory + Beginning inventory 
B)  Required production = Projected sales + Desired ending inventory - Beginning inventory 
C)  Required production = Projected sales - Desired ending inventory - Beginning inventory 
D)  Required production = Projected sales + Desired ending inventory + Beginning inventory

Question 7

Baker Inc., a local manufacturer of cooking tools, had the following information available for 2013:   How many units should Baker's 2013 flexible sales budget be based upon?

Accepted Answer

A)  268,000 units 
B)  265,000 units 
C)  245,000 units 
D)  262,000 units 
A)  268,000 units 
B)  265,000 units 
C)  245,000 units 
D)  262,000 units

Question 8

Which type of budget, static or flexible, should be used by managers for control activities? Explain your answer.

Accepted Answer

Flexible budgets are better suited for c

Cash outflows for interest on line of credit will be shown:

Which of the following is an advantage of the budgeting process?

Budgets are:

Which of the following equations best depicts a basic production budget?

Baker Inc., a local manufacturer of cooking tools, had the following information available for 2013: How many units should Baker's 2013 flexible sales budget be based upon?

Which type of budget, static or flexible, should be used by managers for control activities? Explain your answer.

Introduction to Managerial Accounting

Product Costing: Manufacturing Processes, Cost Terminology, and Cost Flows

Job Costing, Process Costing, and Operations Costing

Activity-Based Costing

Cost Behavior

Cost-Volume-Profit Analysis

Relevant Costs and Product Planning Decisions

Long-Term Capital Investment Decisions

Variance Analysis A Tool for Cost Control and Performance Evaluation

Decentralization, Performance Evaluation, and the Balanced Scorecard

Financial Statement Analysis

The Statement of Cash Flows

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Exam 9: The Use of Budgets in Planning and Decision Making

Cash outflows for interest on line of credit will be shown:

Which of the following is an advantage of the budgeting process?

Budgets are:

Which of the following equations best depicts a basic production budget?

Baker Inc., a local manufacturer of cooking tools, had the following information available for 2013: How many units should Baker's 2013 flexible sales budget be based upon?

Which type of budget, static or flexible, should be used by managers for control activities? Explain your answer.

Introduction to Managerial Accounting

Product Costing: Manufacturing Processes, Cost Terminology, and Cost Flows

Job Costing, Process Costing, and Operations Costing

Activity-Based Costing

Cost Behavior

Cost-Volume-Profit Analysis

Relevant Costs and Product Planning Decisions

Long-Term Capital Investment Decisions

Variance Analysis A Tool for Cost Control and Performance Evaluation

Decentralization, Performance Evaluation, and the Balanced Scorecard

Financial Statement Analysis

The Statement of Cash Flows

Filters