Deck 14: Sound Inc

Question 1

The first step in setting up a budget in Sage 50 Accounting is -

A)changing the general ledger settings for budgeting
B)choosing the equity accounts you want included in the budget
C)entering budget amounts for the ledger accounts
D)choosing set up budget from the settings icon

Answer 1

D

Question 2

In budget reports -

A)the position is favourable when the sales budget amount is higher
B)the position is unfavourable when the actual sales amount is lower
C)the position is favourable when the budget expense amount is lower
D)the position is unfavourable when the actual expense amount is lower

Answer 2

B

Question 3

Use the partial income statement below to answer the following group of questions

$\begin{array}{lrrr} & \text { Actual } & \text { Budget } & \text { Difference } \\\text { Revenue from Sales } & \$ 65000 & \$ 55000 & 18 \% \\\text { Sales Discounts } & -5000 & -2000 & 150 \% \\\text { Net Sales } & 60000 & 53000 & 13 \% \\\text { Advertising } & 4000 & 1000 & 300 \% \\\text { Cost of Goods Sold } & 25000 & 28000 & -11 \% \\& & & \\\text { Sales Commissions } & 6000 & 3000 & 100 \% \\\text { Other Expenses } & 4000 & 4000 & 0 \% \\\text { Total Expenses } & 39000 & 36000 & 8 \%\\\\\text{Net Income}&\underline{21000}&17000& \mathbf{2 4 \%}\end{array}$

-From these results,you might conclude -

A)increased advertising expenditures contributed to better performance
B)sales commissions were a successful incentive to improve sales results
C)discount sales terms encouraged more customers to buy
D)all of the above conclusions are consistent with the results

Answer 3

all of the above conclusions are consistent with the results

Question 4

Budget amounts should be changed -

A)when actual performance is better than the budget targets
B)when expenses are greater than revenue
C)at the beginning of each new fiscal period
D)not necessarily in any of the situations above

Question 5

Which one of the following general statements is true -

A)budget amounts cannot be changed at any time
B)after setup of budget data,previous operating procedures will change
C)budget reports present current ledger data as well as budgeted amounts
D)all of the above

Question 6

Batch printing is available -

A)after you turn on the option in the print reports screen
B)after you turn on the option in the invoices screen
C)after you turn on the option in the forms settings screen
D)at any time,you do not need to turn on the feature

Question 7

To change budgeted amounts,you can -

A)edit the budget frequency
B)edit budget amounts in the general ledger
C)edit budget amounts in the income statement
D)all of the above

Question 8

Budget frequencies should be changed -

A)when you want to report income for a shorter period than the budget
B)when you want to report income for a longer period than the budget
C)when the business cycle changes
D)whenever you change budget amounts

Question 9

Printing in batches can be turned on -

A)from the invoice preview screen
B)from the invoice journal input screen
C)from the journal display screen
D)none of the above
**********************
Use the partial income statement below to answer the following group of questions (#19-#21)
Actual Budget Difference
Revenue from Sales $65 000 $55 000 18%
Sales Discounts -5 000 -2 000 150%
Net Sales 60 000 53 000 13%
Advertising 4 000 1 000 300%
Cost of Goods Sold 25 000 28 000 -11%
Sales Commissions 6 000 3 000 100%
Other Expenses 4 000 4 000 0%
Total Expenses 39 000 36 000 8%
Net Income 21 000 17 000 24%

Question 10

Printing in batches can be used -

A)to print several invoices at one time
B)to print several cheques at one time
C)to print several sales orders at one time
D)for all of the above

Question 11

To print in batches you must -

A)turn on the option to print in batches for all forms in the reports and forms settings screen
B)turn on the option to print in batches in the company,forms setting screen
C)turn on the option to print in batches for each form you want to print this way
D)both b and c above are needed to print in batches

Question 12

To change a quarterly budget to a monthly frequency you must -

A)recalculate the budget amounts for each month
B)not exceed the fiscal period chosen for the company dates
C)recalculate the budget amounts manually
D)enter general settings and change the frequency to monthly for automatic calculations

Question 13

Use the partial income statement below to answer the following group of questions

$\begin{array}{lrrr} & \text { Actual } & \text { Budget } & \text { Difference } \\\text { Revenue from Sales } & \$ 65000 & \$ 55000 & 18 \% \\\text { Sales Discounts } & -5000 & -2000 & 150 \% \\\text { Net Sales } & 60000 & 53000 & 13 \% \\\text { Advertising } & 4000 & 1000 & 300 \% \\\text { Cost of Goods Sold } & 25000 & 28000 & -11 \% \\& & & \\\text { Sales Commissions } & 6000 & 3000 & 100 \% \\\text { Other Expenses } & 4000 & 4000 & 0 \% \\\text { Total Expenses } & 39000 & 36000 & 8 \%\\\\\text{Net Income}&\underline{21000}&17000& \mathbf{2 4 \%}\end{array}$

-The percentages in the difference section of the statement show that -

A)cost of goods sold was lower than budgeted but other costs were higher
B)cost of goods sold was higher than budgeted but other costs were lower
C)all expenses were reasonable
D)net income was higher than budgeted because the percent difference for expenses was less than the difference for sales

Question 14

Budget information may be added to the following reports -

A)general ledger reports
B)journal reports
C)income statements
D)management reports

Question 15

Which of the following statements is correct about budgets -

A)there is a module window for journals that use budgets
B)budget settings are entered on the budget module settings screen
C)budget amounts do not affect journal transactions
D)all of the above

Question 16

In the income statement reports,once budgets are set up -

A)budgeted amounts may be omitted from the reports
B)actual amounts are always greater than the budgeted amounts
C)actual amounts are always less than the budgeted amounts
D)actual amounts are always given as a percentage of the budgeted amounts

Question 17

What reports are affected by the budgeting process -

A)income statements
B)balance sheets
C)customer sales summary reports
D)supplier purchases summary reports

Question 18

Which of the following statements do not contain features required of a budget -

A)choosing asset and liability accounts
B)entering a budget period frequency
C)choosing revenue and expense accounts
D)entering the budget amounts

Question 19

If budget forecasts are incorrect you can change the budget amounts by -

A)cancelling the budget this account feature
B)processing an entry through the general journal
C)editing amounts in the general ledger budget tab screen
D)you cannot change the amounts once they are set for a period

Question 20

Use the partial income statement below to answer the following group of questions

$\begin{array}{lrrr} & \text { Actual } & \text { Budget } & \text { Difference } \\\text { Revenue from Sales } & \$ 65000 & \$ 55000 & 18 \% \\\text { Sales Discounts } & -5000 & -2000 & 150 \% \\\text { Net Sales } & 60000 & 53000 & 13 \% \\\text { Advertising } & 4000 & 1000 & 300 \% \\\text { Cost of Goods Sold } & 25000 & 28000 & -11 \% \\& & & \\\text { Sales Commissions } & 6000 & 3000 & 100 \% \\\text { Other Expenses } & 4000 & 4000 & 0 \% \\\text { Total Expenses } & 39000 & 36000 & 8 \%\\\\\text{Net Income}&\underline{21000}&17000& \mathbf{2 4 \%}\end{array}$

-Which one of the following is not a reasonable explanation for these results -

A)net income was higher than budgeted because sales were higher than budgeted
B)net income was higher than budgeted because some expenses were lower than budgeted
C)net income was higher than budgeted because the budget was not realistic
D)net income may have been higher because inventory prices were raised after the budget was set