ACCT CH 9 ADAPTIVE PRACTICE

The Crawford Company has 3,000 units in beginning finished goods. The sales budget shows expected sales to be 12,000 units. If the production budget shows that 14,000 units are required for production, what was the desired ending finished goods? A : 1,000 B : 5,000 C : 3,000 D : 9,000

5,000

The Burlington Company has 12,000 units in beginning finished goods. If sales are expected to be 60,000 units for the year and Burlington desires ending finished goods of 15,000 units, how many units must Burlington produce? A : 57,000 B : 60,000 C : 75,000 D : 63,000

63,000

Which of the following represents the flow of budget data under participative budgeting? A : President to Plant Manager to Department Manager B : Department Manager to Plant Manager to Vice President of Production C : Department Manager to Vice President of Production to Plant Manager D : Vice President of Production to Plant Manager to Department Manager

Department Manager to Plant Manager to Vice President of Production

Toledo Manufacturing has the following variable overhead costs:Indirect materials: $2.18/hourIndirect labor: $3.26/hourUtilities: $0.90/hourMaintenance: $0.33/hourDirect labor hours: 14,500If Toledo decides that they need to increase their indirect materials to $2.25 per hour, how much will this increase their total variable costs? A : $980 B : $730 C : $1,150 D : $1,015

$1,015

On January 1, Scarlett Company has a beginning cash balance of $21,000. During the year, the company expects cash disbursements of $170,000 and cash receipts of $145,000. If Scarlett requires an ending cash balance of $20,000, the Scarlett Company must borrow: A : $24,000 B : $16,000 C : $20,000 D : $46,000

$24,000

Katie's Cleaning Service has cleaning contracts for 15 apartments, 45 family homes, and 25 office buildings. She estimates that an apartment takes 4 hours to clean, a home takes 6 hours to clean, and an office building takes 10 hours to clean. Katie pays her cleaning staff $12.50/hour. If each location is cleaned once per week, how much does Katie need to budget for direct labor each month? Assume there are four weeks per month. A : $7,250 B : $29,000 C : $7,083 D : $28,333

$29,000

The Brenneman Company's direct materials budget shows total cost of direct materials purchases for January $125,000, February $150,000 and March $175,000. Cash payments are 60% in the month of purchase and 40% in the following month. The budgeted cash payments for March are A : $165,000. B : $130,000. C : $160,000. D : $150,000.

$165,000.

Rose Company is preparing its direct labor budget for May. Projections for the month are that 8,350 units are to be produced and that direct labor time is three hours per unit. If the labor cost per hour is $9, what is the total budgeted direct labor cost for May? A : $221,400 B : $243,000 C : $217,350 D : $225,450

$225,450

In the Progressa Company required production for June is 44,000 units. To make one unit of finished product, three pounds of direct material Z are required. Actual beginning and desired ending inventories of direct material Z are 100,000 and 110,000 pounds, respectively. How many pounds of direct material Z must be purchased? A : 132,000 B : 126,000 C : 136,000 D : 142,000

142,000

Which of the following statements is correct? A : Service companies prepare budget data using an expected input approach while manufacturers prepare budget data using an expected output approach. B : In the budget process for not-for-profit organizations, the emphasis is on cash flow rather than on revenue and expenses. C : The production budget is derived from the direct materials and direct labor budget. D : The budgets of service companies are approved by voters.

In the budget process for not-for-profit organizations, the emphasis is on cash flow rather than on revenue and expenses.

Which of the following is a characteristic of long-range planning? A : It is used to review progress rather than as a basis for control. B : It is prepared for periods not exceeding one year. C : It focuses on achieving goals such as meeting annual profit objectives. D : More detail is presented than in a budget.

It is used to review progress rather than as a basis for control.

Which line items of the budgeted balance sheet are calculated based on operating budgets? A : Finished goods inventory, raw materials inventory, buildings and equipment, and retained earnings. B : Finished goods inventory, raw materials inventory, and retained earnings. C : Cash, accounts receivable, accounts payable, and buildings and equipment. D : Accounts receivable, accounts payable, retained earnings, and accumulated depreciation.

Finished goods inventory, raw materials inventory, and retained earnings.

In order to assure better management acceptance, the flow of input data for budgeting should begin with the A : top management. B : budget committee. C : lower levels of management. D : accounting department.

lower levels of management.

A purchases budget is used instead of a production budget by A : not-for-profit organizations. B : service enterprises. C : manufacturing companies. D : merchandising companies.

merchandising companies.

Dobbins Resources pays sales commissions of $2 per unit and shipping costs of $0.75 per unit. If Dobbins expects to sell 12,000 units in the third quarter, what will their total variable expenses be? A : $24,000 B : $33,000 C : $9,000 D : $42,000

$33,000

When they made their master budget, Vann Enterprises had direct material per unit costs of $12.43, direct labor per unit costs of $8.46, and manufacturing overhead per unit costs of $14.29. They planned to sell 16,000 units in the first quarter. However, in the first week of the first quarter, the direct material per unit costs rose to $16.12, which increased the selling price of the finished product. Therefore, Vann Enterprises only sold 15,500 units. What would the difference in cost of goods sold be between the budgeted income statement and the actual income statement? A : $59,040 decrease B : $39,605 decrease C : $59,040 increase D : $39,605 increase

$39,605 increase

James Company determines that 13,500 pounds of direct materials are needed for production in July. There are 800 pounds of direct materials on hand at July 1 and the desired ending inventory is 700 pounds. If the cost per pound of direct materials is $3, what is the budgeted total cost of direct materials purchases? A : $40,200 B : $40,800 C : $41,400 D : $39,600

$40,200

The Eccleston Company has the following budgeted sales: January $40,000, February $60,000, and March $50,000. 40% of the sales are for cash and 60% are on credit. For the credit sales, 50% of the amount is collected in the month of sale, and 50% in the next month. The total expected cash receipts during March are A : $52,500 B : $56,000 C : $53,000 D : $50,000

$53,000

City Mission is a not-for-profit organization that provides hot meals, living quarters, and showers for homeless people. Based on their yearly budget, they expect to spend $450,000 on food expenses, $350,000 on housing expenses, $280,000 on staff salaries, $90,000 on utilities, and $118,000 on other expenses. How much will City Mission need to raise in donations? A : at least $1,253,000 B : at least $1,288,000 C : more than $1,562,000 D : less than $1,225,000

at least $1,253,000

Coordinating the preparation of the budget is the responsibility assigned to the A : budget committee. B : top management. C : accounting department. D : lower levels of management.

budget committee.