FiltersDone

Question type

Essay

Multiple Choice

Short Answer

True False

Matching

Exam 22: Budgeting

Show Answer

Share

---

All types

Filters

Study FlashcardsPractice ExamLearn

Question 91

Multiple Choice

Review LaterAdd Note

Review Later

Which of the following budgets is not directly associated with the production budget?

A) Direct materials purchases budget
B) Factory overhead cost budget
C) Capital Expenditures budget
D) Direct labor cost budget

E) B) and D)
F) B) and C)

Correct Answer

verified

Show Answer

Question 92

True/False

Review LaterAdd Note

Review Later

The first budget to be prepared is usually the cash budget.

A) True
B) False

Correct Answer

verified

Show Answer

Question 93

True/False

Review LaterAdd Note

The master budget of a small manufacturer would normally include all necessary component budgets except the budgeted balance sheet.

Budgets are prepared in the Accounting Department and monitored by various department managers.

The capital expenditures budget summarizes future plans for acquisition of fixed assets.

The Cardinal Company had a finished goods inventory of 55,000 units on January 1. Its projected sales for the next four months were: January - 200,000 units; February - 180,000 units; March - 210,000 units; and April - 230,000 units. The Cardinal Company wishes to maintain a desired ending finished goods inventory of 20% of the following months sales. What would be the budgeted inventory for March 31st?

The budget procedures used by a large manufacturer of automobiles would probably not differ from those used by a small manufacturer of paper products.

For February, sales revenue is $700,000; sales commissions are 5% of sales; the sales manager's salary is $96,000; advertising expenses are $80,000; shipping expenses total 2% of sales; and miscellaneous selling expenses are $2,500 plus 1/2 of 1% of sales. Total selling expenses for the month of February are:

Big Wheel, Inc. collects 25% of its sales on account in the month of the sale and 75% in the month following the sale. If sales on account are budgeted to be $150,000 for March and receipts from sales on account total $162,500 in April, what are budgeted sales on account for April?

An August sales forecast projects 6,000 units are going to be sold at a price of $11.50 per unit. The desired ending iventory in units is 15% higher than the beginning inventory of 1,000 units. Total August sales are anticipated to be:

The task of preparing a budget should be the sole task of the most important department in an organization.

Finch Company began its operations on March 31 of the current year. Finch Co. has the following projected costs: (1) 3/4 of the manufacturing costs are paid for in the month they are incurred. 1/4 is paid in the following month. (2) Insurance expense is $1,000 a month, however, the insurance is paid four times yearly in the first month of the quarter, i.e. January, April, July, and October. (3) Property tax is paid once a year in November. The cash payments for Finch Company in the month of May are:

Nuthatch Corporation began its operations on September 1 of the current year. Budgeted sales for the first three months of business are $260,000, $375,000, and $400,000, respectively, for September, October, and November. The company expects to sell 30% of its merchandise for cash. Of sales on account, 80% are expected to be collected in the month of the sale and 20% in the month following the sale. The cash collections in November from accounts receivable are:

The master budget of a small manufacturer would normally include all component budgets that impact on the financial statements.

A disadvantage of static budgets is that they:

Based on the following production and sales estimates for May, determine the number of units expected to be manufactured in May.

The budgeted finished goods inventory and cost of goods sold for a manufacturing company for the year 2012 are as follows: January 1 finished goods, $765,000; December 31 finished goods, $540,000; cost of goods sold for the year, $2,560,000. The budgeted costs of goods manufactured for the year is?

Purple Inc. production budget for Product X for the year ended December 31 is as follows: In Purple's production operations, Materials A, B, and C are required to make Product X. The quantities of direct materials expected to be used for each unit of product are as follows: Prepare a direct materials purchases budget for Product X, assuming that there are no beginning or ending inventories for direct materials (all units purchased are used in production).

When preparing the cash budget, all the following should be considered except:

Past performance is the best overall basis for evaluating current performance and assessing the need for corrective action.