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Deck 6: Master Budgets
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Question
Answer the following questions using the information below:
Sadaf Athletic Inc., expects to sell 60,000 athletic uniforms for $80 each in 2015. Direct materials costs are $20, direct manufacturing labor is $8, and manufacturing overhead is $6 for each uniform. The following inventory levels apply to 2014:
-What is the amount budgeted for direct material purchases in 2015?
A) $1,520,000
B) $1,160,000
C) $1,200,000
D) $1,040,000
Sadaf Athletic Inc., expects to sell 60,000 athletic uniforms for $80 each in 2015. Direct materials costs are $20, direct manufacturing labor is $8, and manufacturing overhead is $6 for each uniform. The following inventory levels apply to 2014:
-What is the amount budgeted for direct material purchases in 2015?
A) $1,520,000
B) $1,160,000
C) $1,200,000
D) $1,040,000
Question
Answer the following questions using the information below:
Waseem Company provides the following data for next year:
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:
A) $130,800
B) $69,840
C) $74,160
D) $72,000
Waseem Company provides the following data for next year:
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:
A) $130,800
B) $69,840
C) $74,160
D) $72,000
Question
Answer the following questions using the information below:
Waseem Company provides the following data for next year:
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:
A) $64,800
B) $60,480
C) $115,200
D) $69,120
Waseem Company provides the following data for next year:
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:
A) $64,800
B) $60,480
C) $115,200
D) $69,120
Question
Question
Answer the following questions using the information below:
Kramer Enterprises reports year-end information from 2014 as follows:
Kramer is developing the 2015 budget. In 2015 the company would like to increase selling prices by 8%, and as a result expects a decrease in sales volume of 10%. All other operating expenses are expected to remain constant. Assume that COGS is a variable cost and that operating expenses are a fixed cost.
-What is budgeted sales for 2015?
A) $933,120
B) $864,000
C) $1,036,800
D) $1,066,666
Kramer Enterprises reports year-end information from 2014 as follows:
Kramer is developing the 2015 budget. In 2015 the company would like to increase selling prices by 8%, and as a result expects a decrease in sales volume of 10%. All other operating expenses are expected to remain constant. Assume that COGS is a variable cost and that operating expenses are a fixed cost.-What is budgeted sales for 2015?
A) $933,120
B) $864,000
C) $1,036,800
D) $1,066,666
Question
Answer the following questions using the information below:
Kramer Enterprises reports year-end information from 2014 as follows:
Kramer is developing the 2015 budget. In 2015 the company would like to increase selling prices by 8%, and as a result expects a decrease in sales volume of 10%. All other operating expenses are expected to remain constant. Assume that COGS is a variable cost and that operating expenses are a fixed cost.
-What is budgeted cost of goods sold for 2015?
A) $622,080
B) $576,000
C) $640,000
D) $691,200
Kramer Enterprises reports year-end information from 2014 as follows:
Kramer is developing the 2015 budget. In 2015 the company would like to increase selling prices by 8%, and as a result expects a decrease in sales volume of 10%. All other operating expenses are expected to remain constant. Assume that COGS is a variable cost and that operating expenses are a fixed cost.-What is budgeted cost of goods sold for 2015?
A) $622,080
B) $576,000
C) $640,000
D) $691,200
Question
Answer the following questions using the information below:
Basim Enterprises reports the year-end information from 2014 as follows:
Basim is developing the 2015 budget. In 2015 the company would like to increase selling prices by 4%, and as a result expects a decrease in sales volume of 10%. All other operating expenses are expected to remain constant. Assume that COGS is a variable cost and that operating expenses are a fixed cost.
-What is budgeted sales for 2015?
A) $252,000
B) $291,200
C) $262,080
D) $280,000
Basim Enterprises reports the year-end information from 2014 as follows:
Basim is developing the 2015 budget. In 2015 the company would like to increase selling prices by 4%, and as a result expects a decrease in sales volume of 10%. All other operating expenses are expected to remain constant. Assume that COGS is a variable cost and that operating expenses are a fixed cost.-What is budgeted sales for 2015?
A) $252,000
B) $291,200
C) $262,080
D) $280,000
Question
Answer the following questions using the information below:
Basim Enterprises reports the year-end information from 2014 as follows:
Basim is developing the 2015 budget. In 2015 the company would like to increase selling prices by 4%, and as a result expects a decrease in sales volume of 10%. All other operating expenses are expected to remain constant. Assume that COGS is a variable cost and that operating expenses are a fixed cost.
-What is budgeted cost of goods sold for 2015?
A) $94,500
B) $109,200
C) $105,000
D) $98,280
Basim Enterprises reports the year-end information from 2014 as follows:
Basim is developing the 2015 budget. In 2015 the company would like to increase selling prices by 4%, and as a result expects a decrease in sales volume of 10%. All other operating expenses are expected to remain constant. Assume that COGS is a variable cost and that operating expenses are a fixed cost.-What is budgeted cost of goods sold for 2015?
A) $94,500
B) $109,200
C) $105,000
D) $98,280
Question
Answer the following questions using the information below:
Basim Enterprises reports the year-end information from 2014 as follows:
Basim is developing the 2015 budget. In 2015 the company would like to increase selling prices by 4%, and as a result expects a decrease in sales volume of 10%. All other operating expenses are expected to remain constant. Assume that COGS is a variable cost and that operating expenses are a fixed cost.
-Should Basim increase the selling price in 2015?
A) Yes, because sales revenue is increased for 2015.
B) No, because gross margin decreases for 2015.
C) Yes, because operating income is increased for 2015.
D) No, because sales volume decreases for 2015.
Basim Enterprises reports the year-end information from 2014 as follows:
Basim is developing the 2015 budget. In 2015 the company would like to increase selling prices by 4%, and as a result expects a decrease in sales volume of 10%. All other operating expenses are expected to remain constant. Assume that COGS is a variable cost and that operating expenses are a fixed cost.-Should Basim increase the selling price in 2015?
A) Yes, because sales revenue is increased for 2015.
B) No, because gross margin decreases for 2015.
C) Yes, because operating income is increased for 2015.
D) No, because sales volume decreases for 2015.
Question
Answer the following questions using the information below:
Sharif and Jabil Enterprises are using the kaizen approach to budgeting for 2014. The budgeted income statement for January 2014 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 budgeted gross margin for March 2014?
A) $396,000
B) $411,940
C) $408,040
D) $392,040
Sharif and Jabil Enterprises are using the kaizen approach to budgeting for 2014. The budgeted income statement for January 2014 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 budgeted gross margin for March 2014?
A) $396,000
B) $411,940
C) $408,040
D) $392,040
Question
Hesham Corporation is using the kaizen approach to budgeting for 2015. The budgeted income statement for January 2015 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 2015.
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 2015.
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Deck 6: Master Budgets
1
Answer the following questions using the information below:
Sadaf Athletic Inc., expects to sell 60,000 athletic uniforms for $80 each in 2015. Direct materials costs are $20, direct manufacturing labor is $8, and manufacturing overhead is $6 for each uniform. The following inventory levels apply to 2014:
-What is the amount budgeted for direct material purchases in 2015?
A) $1,520,000
B) $1,160,000
C) $1,200,000
D) $1,040,000
Sadaf Athletic Inc., expects to sell 60,000 athletic uniforms for $80 each in 2015. Direct materials costs are $20, direct manufacturing labor is $8, and manufacturing overhead is $6 for each uniform. The following inventory levels apply to 2014:
-What is the amount budgeted for direct material purchases in 2015?
A) $1,520,000
B) $1,160,000
C) $1,200,000
D) $1,040,000
$1,040,000
2
Answer the following questions using the information below:
Waseem Company provides the following data for next year:
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:
A) $130,800
B) $69,840
C) $74,160
D) $72,000
Waseem Company provides the following data for next year:
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:
A) $130,800
B) $69,840
C) $74,160
D) $72,000
$69,840
3
Answer the following questions using the information below:
Waseem Company provides the following data for next year:
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:
A) $64,800
B) $60,480
C) $115,200
D) $69,120
Waseem Company provides the following data for next year:
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:
A) $64,800
B) $60,480
C) $115,200
D) $69,120
$69,120
4
Sa'id Manufacturing expects to produce and sell 6,000 units of Big, its only product, for $20 each. Direct material cost is $2 per unit, direct labor cost is $8 per unit, and variable manufacturing overhead is $3 per unit. Fixed manufacturing overhead is $24,000 in total. Variable selling and administrative expenses are $1 per unit, and fixed selling and administrative costs are $3,000 in total. According to generally accepted accounting principles, inventoriable cost per unit of Big would be:
A) $17.00 per unit
B) $18.50 per unit
C) $13.00 per unit
D) $14.00 per unit
A) $17.00 per unit
B) $18.50 per unit
C) $13.00 per unit
D) $14.00 per unit
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5
Answer the following questions using the information below:
Kramer Enterprises reports year-end information from 2014 as follows:
Kramer is developing the 2015 budget. In 2015 the company would like to increase selling prices by 8%, and as a result expects a decrease in sales volume of 10%. All other operating expenses are expected to remain constant. Assume that COGS is a variable cost and that operating expenses are a fixed cost.
-What is budgeted sales for 2015?
A) $933,120
B) $864,000
C) $1,036,800
D) $1,066,666
Kramer Enterprises reports year-end information from 2014 as follows:
Kramer is developing the 2015 budget. In 2015 the company would like to increase selling prices by 8%, and as a result expects a decrease in sales volume of 10%. All other operating expenses are expected to remain constant. Assume that COGS is a variable cost and that operating expenses are a fixed cost.-What is budgeted sales for 2015?
A) $933,120
B) $864,000
C) $1,036,800
D) $1,066,666
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Unlock for access to all 11 flashcards in this deck.
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6
Answer the following questions using the information below:
Kramer Enterprises reports year-end information from 2014 as follows:
Kramer is developing the 2015 budget. In 2015 the company would like to increase selling prices by 8%, and as a result expects a decrease in sales volume of 10%. All other operating expenses are expected to remain constant. Assume that COGS is a variable cost and that operating expenses are a fixed cost.
-What is budgeted cost of goods sold for 2015?
A) $622,080
B) $576,000
C) $640,000
D) $691,200
Kramer Enterprises reports year-end information from 2014 as follows:
Kramer is developing the 2015 budget. In 2015 the company would like to increase selling prices by 8%, and as a result expects a decrease in sales volume of 10%. All other operating expenses are expected to remain constant. Assume that COGS is a variable cost and that operating expenses are a fixed cost.-What is budgeted cost of goods sold for 2015?
A) $622,080
B) $576,000
C) $640,000
D) $691,200
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Unlock for access to all 11 flashcards in this deck.
Unlock Deck
k this deck
7
Answer the following questions using the information below:
Basim Enterprises reports the year-end information from 2014 as follows:
Basim is developing the 2015 budget. In 2015 the company would like to increase selling prices by 4%, and as a result expects a decrease in sales volume of 10%. All other operating expenses are expected to remain constant. Assume that COGS is a variable cost and that operating expenses are a fixed cost.
-What is budgeted sales for 2015?
A) $252,000
B) $291,200
C) $262,080
D) $280,000
Basim Enterprises reports the year-end information from 2014 as follows:
Basim is developing the 2015 budget. In 2015 the company would like to increase selling prices by 4%, and as a result expects a decrease in sales volume of 10%. All other operating expenses are expected to remain constant. Assume that COGS is a variable cost and that operating expenses are a fixed cost.-What is budgeted sales for 2015?
A) $252,000
B) $291,200
C) $262,080
D) $280,000
Unlock Deck
Unlock for access to all 11 flashcards in this deck.
Unlock Deck
k this deck
8
Answer the following questions using the information below:
Basim Enterprises reports the year-end information from 2014 as follows:
Basim is developing the 2015 budget. In 2015 the company would like to increase selling prices by 4%, and as a result expects a decrease in sales volume of 10%. All other operating expenses are expected to remain constant. Assume that COGS is a variable cost and that operating expenses are a fixed cost.
-What is budgeted cost of goods sold for 2015?
A) $94,500
B) $109,200
C) $105,000
D) $98,280
Basim Enterprises reports the year-end information from 2014 as follows:
Basim is developing the 2015 budget. In 2015 the company would like to increase selling prices by 4%, and as a result expects a decrease in sales volume of 10%. All other operating expenses are expected to remain constant. Assume that COGS is a variable cost and that operating expenses are a fixed cost.-What is budgeted cost of goods sold for 2015?
A) $94,500
B) $109,200
C) $105,000
D) $98,280
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Unlock for access to all 11 flashcards in this deck.
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9
Answer the following questions using the information below:
Basim Enterprises reports the year-end information from 2014 as follows:
Basim is developing the 2015 budget. In 2015 the company would like to increase selling prices by 4%, and as a result expects a decrease in sales volume of 10%. All other operating expenses are expected to remain constant. Assume that COGS is a variable cost and that operating expenses are a fixed cost.
-Should Basim increase the selling price in 2015?
A) Yes, because sales revenue is increased for 2015.
B) No, because gross margin decreases for 2015.
C) Yes, because operating income is increased for 2015.
D) No, because sales volume decreases for 2015.
Basim Enterprises reports the year-end information from 2014 as follows:
Basim is developing the 2015 budget. In 2015 the company would like to increase selling prices by 4%, and as a result expects a decrease in sales volume of 10%. All other operating expenses are expected to remain constant. Assume that COGS is a variable cost and that operating expenses are a fixed cost.-Should Basim increase the selling price in 2015?
A) Yes, because sales revenue is increased for 2015.
B) No, because gross margin decreases for 2015.
C) Yes, because operating income is increased for 2015.
D) No, because sales volume decreases for 2015.
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Unlock for access to all 11 flashcards in this deck.
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10
Answer the following questions using the information below:
Sharif and Jabil Enterprises are using the kaizen approach to budgeting for 2014. The budgeted income statement for January 2014 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 budgeted gross margin for March 2014?
A) $396,000
B) $411,940
C) $408,040
D) $392,040
Sharif and Jabil Enterprises are using the kaizen approach to budgeting for 2014. The budgeted income statement for January 2014 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 budgeted gross margin for March 2014?
A) $396,000
B) $411,940
C) $408,040
D) $392,040
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Unlock for access to all 11 flashcards in this deck.
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11
Hesham Corporation is using the kaizen approach to budgeting for 2015. The budgeted income statement for January 2015 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 2015.
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 2015.
Unlock Deck
Unlock for access to all 11 flashcards in this deck.
Unlock Deck
k this deck
Unlock Deck
Unlock for access to all 11 flashcards in this deck.
