Managerial Accounting Chapter 8

A detailed plan for the future that is usually expressed in formal quantitative terms is a(n) ____

budget

The receipts, disbursements, excess or deficiency, and financing section are all parts of the ______ budget. -sales -production -selling and administrative expense -cash

cash

A company's planned net profit that serves as a benchmark against which subsequent company performance can be measured is shown on the budgeted ____ ____

income statement

Using budgeting assumptions when preparing the master budget, ______. -makes it easier to answer "what-if" questions -involves adjusting data inputs within each master budget schedule -increases the complexity of the process

makes it easier to answer "what-if" questions

All costs of production other than direct materials and direct labor are shown on the ____ ____ budget

manufacturing overhead

An integrated business plan that formally lays out the company's goals is called the ______ budget. -master -profit planning -sales -self-imposed

master

The amount of goods for resale to be acquired from suppliers during the period is shown on the ____ ____ budget

merchandise purchases

The amount of goods to be acquired from suppliers during the period is shown on the _______ budget. -direct labor -merchandise purchases -sales -manufacturing overhead

merchandise purchases

In large organizations, many smaller individual budgets submitted by department heads and other responsible people comprise the ______ budget. -manufacturing overhead -selling and administrative -ending finished goods inventory -cash

selling and administrative

A company can consider making investments or repay outstanding principal and interest when ______. -the cash excess is greater than the minimum required cash balance -the cash excess is less than the minimum required cash balance -the cash excess equals the minimum required cash balance -there is a cash deficiency

the cash excess is greater than the minimum required cash balance

The annual master budget file includes the ______ from last year because it is needed for the schedule of expected cash collections. -cash budget -balance sheet -income statement -sales budget

balance sheet

To prepare a budgeted balance sheet as of December 31, 2020, data is needed from the ______ December 31, 2019. -income statement for the year ended -balance sheet as of -statement of cash flows for the year ended

balance sheet as of

When a manager creates a budget that is too easy to attain, ______ occurs. -perpetual budgeting -participative budgeting -budgetary slack -self-imposted budgeting

budgetary slack

The number of working hours required to satisfy the production budget is shown on the ____ ____ budget

direct labor

Working hours required to satisfy the production budget are shown on the ______ budget. -cash -direct materials -merchandise purchases -direct labor

direct labor

More accurate estimates and higher motivation are generally the result of using a(n) ______ budget. -imposed -participative -perpetual -continuous

participative

Which of the following budgets shows the company's planned profit and serves as a benchmark against which subsequent company performance can be measured? -Budgeted balance sheet -Budgeted income statement -Budgeted selling and administrative expenses -Manufacturing overhead budget

Budgeted income statement

True or false: Control involves developing goals and preparing various budgets to achieve those goals.

False

True or false: Many of the schedules in a master budget are based on a variety of management estimates and assumptions.

True

A detailed plan for the future that is usually expressed in formal quantitative terms is ______. -a budget -responsibility accounting -the budget period -profit planning

a budget

Required borrowings on a cash budget is calculated by ______. -subtracting the desired ending cash balance from the amount of cash excess -subtracting the beginning cash balance from the amount of the cash deficiency -adding the desired ending cash balance to the amount of cash excess -adding the desired ending cash balance to the amount of the cash deficiency

adding the desired ending cash balance to the amount of the cash deficiency

Because it is needed for the schedule of expected cash collections, the annual master budget file includes the ____ ____ from last year

balance sheet

Budgets ______. -communicate management's plan throughout the organization -focus on what has happened in the past -primarily help managers with day-to-day emergencies

communicate management's plan throughout the organization

Budgets are used for two distinct purposes: ______ and ______. -planning; control -benchmarking; integrating -advising; consulting -executing; overseeing

planning; control

In a manufacturing company, the ____ budget is prepared right after the sales budget.

production

A manager cannot complain that the budget was unrealistic and impossible to meet when a(n) ____-____ budget is in place.

self-imposed

Budgeted expenses for areas other than manufacturing are shown on the ______ budget. -ending finished goods inventory -selling and administrative -cash -manufacturing overhead

selling and administrative

When creating an Excel budget and performing what-if analysis, it is generally easiest to ______. -create the budget with a budgeting assumption tab -copy the master budget and make change to the copy only -adjust data inputs within each master budget schedule

create the budget with a budgeting assumption tab

The cost of unsold units is computed on the ______ budget. -ending finished goods inventory -manufacturing overhead -sales -production

ending finished goods inventory

The ending finished goods inventory budget computes the cost of ______ units. -sold -unsold

unsold

The receipts section of the cash budget lists ______. -all cash inflows, except from financing -total credit sales -all cash inflows -total sales for the period

all cash inflows, except from financing

Select all that apply Master budget schedules ______. -may be prepared in any order -answer several key questions for a company -are based on estimates and assumptions

answer several key questions for a company are based on estimates and assumptions

A budgeted balance sheet is developed using data from the ______ of the budget period and data contained in the various schedules. -end -average -beginning

beginning

The section on the cash budget that summarizes all cash payments that are planned for the budget period is the cash ____ section

disbursements

All costs of production other than direct materials and direct labor are shown on the ______ budget. -merchandise purchases -cash -manufacturing overhead -ending finished goods inventory

manufacturing overhead

A number of separate, but interdependent, budgets that formally lay out the company's sales, production, and financial goals are contained in the ___ budget

master

Developing goals and preparing various budgets to achieve those goals is part of ______, -responsibility accounting -control -the budget period -planning

planning

Developing goals and preparing various budgets to achieve those goals is part of the ____ process

planning

Select all that apply Borrowing money is required whenever ______. -the cash excess is greater than the minimum required cash balance -there is a cash deficiency -the cash excess equals the minimum required cash balance -the cash excess is less than the minimum required cash balance

there is a cash deficiency the cash excess is less than the minimum required cash balance

Budgetary slack occurs when a manager submits a budget that is ______. -too easy to attain -vague -too difficult to attain -much like budgets submitted over the previous few years

too easy to attain

Because all other parts of the budget depend on it, if the ______ budget is inaccurate, the rest of the budget will be inaccurate. -sales -production -cash -direct materials

sales

To calculate total sales on the sales budget, multiply budgeted sales in units by ______. -number of units -sales price per unit -budgeted unit sales

sales price per unit

In a manufacturing company, the ______ budget details the raw materials that must be purchased to fulfill the production budget and provide for adequate inventories -direct materials -sales -production -merchandise purchases

direct materials

The first step in the budgeting process is preparing the ______ budget. -sales -direct materials -cash -production

sales

Select all that apply Budgets ______. -coordinate the activities of the entire organization by integrating the plans of its various parts -and the budgeting process can uncover potential bottlenecks before they occur -provide each department with the same amount of money to spend, so that all departments are treated fairly -force managers to think about and plan for the future -define goals and objectives that can serve as benchmarks for evaluating subsequent performance

coordinate the activities of the entire organization by integrating the plans of its various parts and the budgeting process can uncover potential bottlenecks before they occur force managers to think about and plan for the future define goals and objectives that can serve as benchmarks for evaluating subsequent performance

Which of the following is needed to prepare a sales budget? -Desired ending inventory of raw materials -Beginning inventory of finished goods -Desired ending inventory -The budgeted number of units to be sold

The budgeted number of units to be sold

In a manufacturing company, the ______ budget shows the number of units that must be manufactured to satisfy sales needs and provide for the desired ending inventory. -sales -production -direct materials -cash

production